Cautious Outlook for L’Oreal Amid Slower Beauty Sector Growth and Regional Challenges

L’Oreal (0NZM – Research Report), the Consumer Defensive sector company, was revisited by a Wall Street analyst today. Analyst David Hayes from Jefferies maintained a Hold rating on the stock and has a €374.00 price target.

David Hayes has given his Hold rating due to a combination of factors impacting L’Oreal’s market performance. One key consideration is the recent data from China, where overall retail sales have grown, but the beauty sector has shown a slower increase. This indicates a potential decline in offline sales, despite the growth in online beauty sales.
Additionally, there is a concern about North Asia’s growth, which is expected to remain subdued. The anticipated performance of L’Oreal in the first quarter suggests a risk of missing formal consensus expectations, particularly in light of negative results from other major players in the industry. These factors contribute to a cautious outlook, justifying the Hold rating.

In another report released yesterday, UBS also maintained a Hold rating on the stock with a €353.00 price target.