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L'Oreal (LRLCY)
OTHER OTC:LRLCY
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L'Oreal
(OTC:LRLCY)
80Outperform
L'Oreal (LRLCY) vs. S&P 500 (SPY)
Market Cap
$197.11B
Dividend Yield1.36%
Average Volume (3M)10.94K
Price to Earnings (P/E)28.6
Beta (1Y)0.49
Revenue Growth5.65%
EPS Growth3.79%
CountryUS
Employees94,397
SectorConsumer Defensive
Sector Strength79
IndustryHousehold & Personal Products
Share Statistics
EPS (TTM)2.59
Shares Outstanding2,671,560,000
10 Day Avg. Volume0
30 Day Avg. Volume10,941
Financial Highlights & Ratios
PEG Ratio7.53
Price to Book (P/B)N/A
Price to Sales (P/S)4.89
Price to Cash Flow (P/CF)N/A
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$81.60Price Target Upside10.17% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering3
L'Oreal Business Overview & Revenue Model
Company DescriptionL'Oreal (LRLCY) is a leading global beauty company headquartered in France, renowned for its comprehensive portfolio of brands and products spanning across skincare, haircare, makeup, and fragrances. The company operates in various sectors of the beauty industry, serving both professional and consumer markets. With a strong emphasis on research and innovation, L'Oreal continuously develops new products to meet diverse consumer needs and preferences across the world.
How the Company Makes MoneyL'Oreal generates revenue primarily through the sale of beauty and personal care products across its vast portfolio of brands, which includes well-known names such as L'Oreal Paris, Maybelline, Lancôme, and Kiehl's. The company's revenue model involves both direct-to-consumer sales through e-commerce platforms and retail partnerships with department stores, salons, and pharmacies. Additionally, L'Oreal invests heavily in marketing and advertising to enhance brand visibility and customer engagement globally. Significant partnerships with retail giants and strategic acquisitions of emerging brands also contribute to its financial success, helping L'Oreal maintain a robust presence in both mature and developing markets.
L'Oreal Financial Statement Overview
Summary
L'Oreal demonstrates strong financial performance with consistent revenue growth, robust profitability, effective cash management, and a solid balance sheet. The financial position is stable, though monitoring debt levels and focusing on net income growth are suggested for further improvement.Income Statement
L'Oreal has shown consistent revenue growth with a notable revenue growth rate of 7.64% from 2022 to 2023. The company maintains strong profitability margins, with a Gross Profit Margin of 73.84% and a Net Profit Margin of 15.02% in 2023. EBIT and EBITDA margins also reflect solid operational performance. The income statement shows a positive growth trajectory, though there's room for improvement in expanding net income further.88
Very Positive
Balance Sheet
The balance sheet reflects a stable financial position for L'Oreal, with a Debt-to-Equity Ratio of 0.30, indicating manageable leverage. The Return on Equity (ROE) is robust at 21.27%, showcasing effective equity utilization. An Equity Ratio of 56.07% denotes a strong equity base relative to total assets. While financial stability is evident, there is a slight increase in total debt, which should be monitored for future leverage risks.82
Very Positive
Cash Flow
Cash flow analysis reveals strong operational cash generation with Operating Cash Flow exceeding Net Income, resulting in a healthy Operating Cash Flow to Net Income Ratio of 1.23. Free Cash Flow growth is positive, with a significant increase of 23.92% from the previous year, reflecting effective cash management. The Free Cash Flow to Net Income Ratio of 0.99 indicates efficient conversion of earnings into free cash flow.85
Very Positive
| Breakdown | |||||
| TTM | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 | Dec 2019 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 48.15B | 41.18B | 38.26B | 32.29B | 27.99B | 29.87B | Gross Profit |
| 35.16B | 30.42B | 27.68B | 23.85B | 20.46B | 21.81B | EBIT |
| 9.34B | 8.14B | 7.46B | 6.16B | 5.21B | 5.55B | EBITDA |
| 7.70B | 9.66B | 9.22B | 7.88B | 6.90B | 7.46B | Net Income Common Stockholders |
| 7.57B | 6.18B | 5.71B | 4.60B | 3.56B | 3.75B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 4.29B | 4.32B | 2.64B | 2.72B | 6.41B | 5.29B | Total Assets |
| 51.86B | 51.86B | 46.84B | 43.01B | 43.61B | 43.81B | Total Debt |
| 8.69B | 8.69B | 5.65B | 6.30B | 2.55B | 2.89B | Net Debt |
| 4.40B | 4.40B | 3.03B | 3.59B | -3.86B | -2.40B | Total Liabilities |
| 22.77B | 22.77B | 19.66B | 19.42B | 14.61B | 14.38B | Stockholders Equity |
| 29.07B | 29.07B | 27.18B | 23.59B | 28.99B | 29.42B |
| Cash Flow | Free Cash Flow | ||||
| 7.28B | 6.12B | 4.94B | 5.65B | 5.48B | 5.03B | Operating Cash Flow |
| 9.06B | 7.60B | 6.28B | 6.73B | 6.45B | 6.26B | Investing Cash Flow |
| -2.46B | -4.14B | -2.22B | -1.63B | -2.64B | -1.29B | Financing Cash Flow |
| -9.52B | -1.61B | -4.08B | -8.86B | -2.59B | -3.69B |
L'Oreal Technical Analysis
Negative
74.07
Price Trends
74.36
Positive
72.44
Positive
79.23
Negative
Market Momentum
0.21
Positive
46.29
Neutral
5.77
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LRLCY, the sentiment is Negative. The current price of 74.07 is below the 20-day moving average (MA) of 77.05, below the 50-day MA of 74.36, and below the 200-day MA of 79.23, indicating a neutral trend. The MACD of 0.21 indicates Positive momentum. The RSI at 46.29 is Neutral, neither overbought nor oversold. The STOCH value of 5.77 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for LRLCY.
L'Oreal Peers Comparison
Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $197.11B | 28.55 | 20.87% | 1.36% | 5.65% | 3.79% | |
79 Outperform | $75.28B | 26.45 | 704.02% | 2.15% | 3.30% | 26.83% | |
76 Outperform | $394.01B | 26.77 | 31.05% | 2.40% | 0.49% | 5.02% | |
76 Outperform | $149.00B | 23.74 | 30.53% | 3.13% | 1.99% | -10.59% | |
63 Neutral | $20.66B | 14.30 | -10.05% | 3.14% | 1.30% | 2.76% | |
57 Neutral | $4.75B | 40.12 | 0.33% | ― | 1.35% | -99.94% | |
50 Neutral | $23.53B | 147.29 | -14.17% | 3.09% | 0.07% | -249.21% |
* Consumer Defensive Sector Average
Performance Comparison
LRLCY
L'Oreal
74.07
-19.19
-20.58%
CL
Colgate-Palmolive
93.70
6.54
7.50%
EL
The Estée Lauder Companies
66.00
-82.67
-55.61%
PG
Procter & Gamble
170.42
13.70
8.74%
UL
Unilever
59.55
11.28
23.37%
COTY
Coty
5.47
-6.42
-53.99%
L'Oreal Earnings Call Summary
Earnings Call Date: Feb 6, 2025 | % Change Since: 2.83% | Next Earnings Date: Aug 5, 2025
Earnings Call Sentiment Positive
L'Oréal experienced a record-breaking year with strong performances in Europe, North America, and emerging markets, as well as impressive growth in key categories like fragrances and hair care. However, challenges in North Asia, particularly in China and travel retail, posed significant hurdles. Despite these challenges, L'Oréal's strategic acquisitions and strong innovation pipeline for 2025 position the company for continued growth.Highlights
Record-Breaking Year for L'Oréal
L'Oréal set several new records with a like-for-like growth of 5.1%, gross margin at 74.2%, and operating profit margin reaching 20% for the first time.
Strong Regional Growth
Europe advanced by 8.2%, North America grew by 5.5%, and emerging markets led with 11.7% growth, contributing significantly to overall sales.
Impressive Division Performances
Professional Products grew by 5.3%, Consumer Products by 5.4%, and Dermatological Beauty by 9.8%, with each division surpassing a 21% operating margin.
Fragrances and Hair Care Lead Category Growth
Fragrances grew by 14.1% and Hair Care by 12.7%, making them the fastest-growing categories.
Strategic Acquisitions and Partnerships
Acquisition of Aesop and investment in Galderma, along with strategic partnerships, to enhance the portfolio and capabilities.
Innovative Pipeline for 2025
Strong innovation pipeline expected to drive growth, including new launches in skincare, fragrances, and makeup.
Lowlights
Challenges in North Asia
Sales in North Asia declined by 3.2% due to continued weakness in Mainland China and travel retail.
Weak Performance in Luxe Division
Luxe division's growth was only 2.7% like-for-like, affected by market turbulence in China despite maintaining a high profit margin.
Slowdown in Chinese Market
The beauty market in Mainland China saw a decline from -2% in H1 to -4% in the full year, affecting overall performance.
Travel Retail Struggles
Travel retail in Asia, particularly in Hainan and Korea, faced significant declines, impacting overall sales.
Company Guidance
During the 2024 Annual Results Presentation, L'Oréal reported several impressive financial metrics. The company achieved a like-for-like growth rate of 5.1%, marking another year of market outperformance. Their gross margin reached an all-time high of 74.2%, up 30 basis points from the previous year, while the operating profit margin increased by 20 basis points, reaching 20% for the first time. Consolidated sales rose by 5.6% to EUR 43.5 billion, with operating net cash flow reaching EUR 6.6 billion, an increase of nearly 9%. Each division contributed to growth, with Professional Products seeing a 5.3% increase, Consumer Products up by 5.4%, L'Oréal Luxe by 2.7% like-for-like, and L'Oréal Dermatological Beauty achieving a 9.8% increase in sales. Regionally, Europe advanced by 8.2%, North America grew by 5.5%, and emerging markets led with an 11.7% increase. Despite a decline in North Asia, the company maintained a strong global footprint, with emerging markets now accounting for more than 16% of sales. The year also marked strategic investments in AI, research, and sustainability efforts, positioning L'Oréal well for future growth.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.