Coty’s Financial Struggles: Declining Revenues and Lowered Guidance Prompt Sell Rating

Bank of America Securities analyst Anna Lizzul has reiterated their bearish stance on COTY stock, giving a Sell rating today.

Anna Lizzul has given her Sell rating due to a combination of factors impacting Coty’s financial performance. The company’s third-quarter results showed a decline in net revenues, with a notable decrease in both the Prestige and Consumer Beauty segments. This decline was driven by weaker demand in prestige makeup and mass color cosmetics, particularly in the U.S. market, which was a significant factor in the overall sales decline.
Additionally, Coty has lowered its guidance for fiscal year 2025, anticipating further moderation in growth across its key segments. The company expects a decrease in like-for-like sales growth and has adjusted its earnings per share guidance downward. Despite some positive aspects, such as a slight beat in adjusted EBITDA, the overall outlook remains challenging, leading to the maintained Underperform rating and a price objective of $4.50.

In another report released today, Barclays also maintained a Sell rating on the stock with a $4.50 price target.