EssilorLuxottica SA (EL) AI Stock Analysis

• Market Cap: €112.21B
• Dividend Yield: 1.62%
• Average Volume (3M): 513.05K
• Price to Earnings (P/E): 47.0
• Beta (1Y): 0.91
• Revenue Growth: 4.38%
• EPS Growth: 1.71%
• Country: FR
• Employees: 153,498
• Sector: Consumer Cyclical
• Sector Strength: 65
• Industry: Medical - Instruments & Supplies
• EPS (TTM): 2.98
• Shares Outstanding: 463,145,540
• 10 Day Avg. Volume: 414,922
• 30 Day Avg. Volume: 513,050
• PEG Ratio: 24.05
• Price to Book (P/B): 2.77
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 33.41
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: €268.09
• Price Target Upside: 9.96% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 12

• Rating: 73 Outperform
• Price Target: €282.00 ▲(15.67%Upside)

EssilorLuxottica SA scores well due to its strong financial performance, characterized by robust profitability, efficient cash flow management, and a stable balance sheet. However, technical analysis presents mixed signals, and the stock's high valuation suggests it may be overvalued, which dampens the overall attractiveness.

Positive Factors

Financial Performance

EssilorLuxottica posted a solid performance overall, especially in DTC (+10.1%) across all geographies.

Market Position

Essilorluxottica is recognized as a structural share taker and prime consolidator in a steadily-growing optical market, showcasing strong innovation from MedTech to Digital and Hearing Care.

Negative Factors

Currency Risks

10% change in the USD/EUR parity has 6% impact on EPS, highlighting FX risks.

Tariffs

Main uncertainty remains tariffs, principally impacting made-in-China frames imported to the US.

EssilorLuxottica SA Business Overview & Revenue Model

Company Description

EssilorLuxottica Société anonyme designs, manufactures, and distributes ophthalmic lenses, frames, and sunglasses in North America, Europe, Latin America, Asia, Oceania, and Africa. It operates in five segments: Wholesale, Retail, Lenses and Optical Instruments, Equipment, and Sunglasses and Readers. The Wholesale segment engages in the manufacture and wholesale distribution of luxury and sports eyewear. The Retail segment retails luxury and sports eyewear. The Lenses and Optical Instruments segment offers lenses and small equipment, including Varilux progressive lenses; Crizal antireflective, anti-smudge, and antistatic lenses; Transitions photochromic lenses; Eyezen lenses for users of computers, tablets, smartphones, and other connected devices; Xperio polarized sun lenses; and Nikon and Kodak corrective lens brands. It also provides lens edging and mounting instruments for opticians and prescription laboratories; optometry instruments for eye care professionals, schools, occupational medicine centers, military, and other institutions; and Transitions Signature Gen 8 photochromic lens, as well as develops solutions for online sales of optical products. The Equipment segment offers digital surfacing machines and lens coating machines to prescription laboratories, integrated optical chains, and lens manufacturers. The Sunglasses and Readers segment provides non-prescription sunglasses and reading glasses under the Foster Grant, Gargoyles, Magnivision, Corinne McCormack, Monkey Monkey, Ryders Eyewear, and SolarShield brands; Reebok, Steve Madden, Betsey Johnson, Nine West, Dockers, French Connection, Ironman, Rawlings, Bodyglove, Panama Jack, Marvel, and Disney; Bolon, Molsion, Qina, and Prosun brands; and Mujosh and Aojo brands. It has a network of 490 prescription laboratories and edging-mounting facilities. The company was formerly known as Essilor International Société Anonyme and changed its name to EssilorLuxottica Société anonyme in October 2018. EssilorLuxottica Société anonyme was founded in 1849 and is headquartered in Paris, France.

How the Company Makes Money

EssilorLuxottica generates revenue through multiple channels, primarily through the sale of eyewear products and lenses. The company's revenue model is driven by its extensive portfolio of proprietary brands and licensed brands, which are distributed through a global network of retail stores, e-commerce platforms, and wholesale partners. Retail operations include well-known chains like LensCrafters and Sunglass Hut. In addition to product sales, EssilorLuxottica benefits from strategic partnerships and collaborations with fashion houses and technology companies, which enhance its market presence and product offerings. The company's vertical integration, from manufacturing to retail, allows it to capture value at multiple stages of the value chain, contributing significantly to its earnings.

EssilorLuxottica SA Financial Statement Overview

Summary

EssilorLuxottica SA demonstrates strong financial health with consistent revenue growth, robust profitability, and efficient cash flow management. The balance sheet is stable with a good equity base, though there is potential for improved asset utilization.

Income Statement

EssilorLuxottica SA shows a strong revenue growth trend with a 4.37% increase from 2023 to 2024. The company maintains solid profitability, evidenced by a gross profit margin of 63.41% and a net profit margin of 8.90% in 2024. The EBIT margin of 13.01% and EBITDA margin of 24.72% further underscore its robust operating performance. Consistent revenue growth and strong margins highlight a well-managed income statement.

Balance Sheet

The company has a healthy equity base with a debt-to-equity ratio of 0.33, indicating moderate leverage. The return on equity (ROE) is a respectable 5.84%, suggesting efficient use of equity capital. The equity ratio stands at 62.84%, reflecting a strong balance sheet with significant equity backing. Overall, the balance sheet exhibits stability, though there is room for improving asset utilization.

Cash Flow

EssilorLuxottica SA demonstrates a stable cash flow position with a free cash flow to net income ratio of 1.42, indicating strong cash generation relative to net income. The operating cash flow to net income ratio is 2.07, highlighting efficient cash conversion. Free cash flow growth was modest at 0.66% from 2023 to 2024, but the overall cash flow metrics suggest solid liquidity and operational cash control.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	26.51B	25.39B	24.49B	19.82B	14.43B
Gross Profit	16.81B	16.05B	15.59B	12.28B	8.49B
EBITDA	6.55B	6.18B	6.10B	4.71B	2.61B
Net Income	2.36B	2.29B	2.15B	1.45B	85.00M
Balance Sheet
Total Assets	64.26B	60.52B	60.56B	59.41B	52.32B
Cash, Cash Equivalents and Short-Term Investments	2.25B	2.56B	1.99B	3.33B	8.93B
Total Debt	13.22B	11.66B	12.20B	13.02B	11.89B
Total Liabilities	23.26B	21.63B	22.41B	23.54B	19.52B
Stockholders Equity	40.38B	38.24B	37.45B	35.06B	32.27B
Cash Flow
Free Cash Flow	3.35B	3.33B	3.21B	3.52B	2.30B
Operating Cash Flow	4.87B	4.86B	4.78B	4.54B	2.95B
Investing Cash Flow	-3.62B	-1.72B	-3.29B	-8.13B	-574.00M
Financing Cash Flow	-1.65B	-2.36B	-2.91B	-1.97B	1.59B

EssilorLuxottica SA Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 243.80
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FR:EL, the sentiment is Positive. The current price of 243.8 is above the 20-day moving average (MA) of 239.93, below the 50-day MA of 245.64, and above the 200-day MA of 243.33, indicating a neutral trend. The MACD of 0.16 indicates Negative momentum. The RSI at 51.84 is Neutral, neither overbought nor oversold. The STOCH value of 43.63 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for FR:EL.

EssilorLuxottica SA Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EL	73 Outperform	€112.21B	46.99	6.00%	1.62%	4.38%	1.71%
Sector *	62 Neutral	C$5.30B	8.88	20.23%	3.47%	3.08%	9.19%
HESAF	―	$287.88B	58.57	28.67%	3.64%	―	―
0NPL	―	€81.11B	15.64	22.73%	3.34%	―	―
0IIH	―	€24.19B	21.36	7.52%	8.29%	―	―
0HAU	―	€236.16B	18.81	19.53%	3.15%	―	―