TD Cowen analyst Oliver Chen has maintained their neutral stance on COTY stock, giving a Hold rating today.
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Oliver Chen’s rating is based on a combination of factors, including Coty’s current market performance and strategic positioning. The company is experiencing challenges in its mass cosmetics segment due to intensified competition and retailer inventory adjustments, which are expected to continue affecting sales in the near term. Additionally, the transition under new leadership and the implementation of a turnaround strategy are still in the early stages, suggesting that immediate growth may not be forthcoming.
Despite these challenges, there are positive indicators such as robust e-commerce growth, recovery in the Chinese market, and strong sales in the US prestige fragrance segment. Chen acknowledges Coty’s global leadership in the fragrance market and sees potential in expanding into high-growth areas like ultra-premium and mist fragrances. However, the path to sustainable top-line and margin growth remains uncertain in the short term, leading to a Hold rating as the company refocuses on its core competencies and innovation pipeline.
Chen covers the Consumer Cyclical sector, focusing on stocks such as Tapestry, Canada Goose Holdings, and LVMH Moet Hennessy Louis Vuitton. According to TipRanks, Chen has an average return of 6.2% and a 53.01% success rate on recommended stocks.
In another report released today, TR | OpenAI – 4o also reiterated a Hold rating on the stock with a $3.50 price target.