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L'Oreal (LRLCY)
OTHER OTC:LRLCY
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L'Oreal
(OTC:LRLCY)
Rating:80Outperform
Price Target:
$101.00
▲(18.24%Upside)
L'Oreal (LRLCY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$231.78B
Dividend Yield1.82%
Average Volume (3M)6.08K
Price to Earnings (P/E)33.7
Beta (1Y)0.30
Revenue Growth5.65%
EPS Growth3.79%
CountryUS
Employees94,397
SectorConsumer Defensive
Sector Strength57
IndustryHousehold & Personal Products
Share Statistics
EPS (TTM)1.17
Shares Outstanding2,671,576,700
10 Day Avg. Volume5,405
30 Day Avg. Volume6,077
Financial Highlights & Ratios
PEG Ratio-24.88
Price to Book (P/B)5.96
Price to Sales (P/S)0.00
P/FCF Ratio29.56
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$101.00Price Target Upside18.24% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering0
L'Oreal Business Overview & Revenue Model
Company DescriptionL'Oréal S.A., through its subsidiaries, manufactures and sells cosmetic products for women and men worldwide. The company operates through four divisions: Consumer Products, L'oréal Luxe, Professional Products, and Active Cosmetics. It offers shampoos, hair care products, shower gels, skin care products, cleansers, hair colors, styling products, deodorants, sun care products, make-up, perfumes, etc. The company provides its products under the L'Oréal Paris, Garnier, Maybelline New York, NYX Professional Makeup, Essie, Niely, Dark and Lovely, Lancôme, Yves Saint Laurent Beauté, Giorgio Armani Beauty, Kiehl's, Urban Decay, Biotherm, Ralph Lauren, IT Cosmetics, L'Oréal Professionnel, Kérastase, Redken, Matrix, Biolage, Pureology, Decléor, Carita, Vichy, La Roche-Posay, SkinCeuticals, Roger&Gallet, CeraVe, Stylenanda, Mixa, Magic Mask, Prada, Helena Rubinstein, Valentino, Mugler, Shu Uemura, Viktor&Rolf, Azzaro, Diesel, Atelier Cologne, Cacharel, and Yue Sai brands. It sells its products through distribution channels, such as hair salons, mass-market retail channels, perfumeries, department stores, pharmacies, drugstores, medispas, branded retail, travel retail, and e-commerce. L'Oréal S.A. was founded in 1909 and is headquartered in Clichy, France.
How the Company Makes MoneyL'Oreal generates revenue through its diverse range of beauty and personal care products, distributed across multiple channels including retail, online platforms, and professional salons. The Consumer Products segment, which includes mass-market brands, is a significant revenue driver, reaching a wide audience through supermarkets, pharmacies, and online retailers. The L'Oreal Luxe segment focuses on premium and luxury brands, sold in department stores and specialty retailers. The Professional Products division serves salons with exclusive haircare and styling products, while the Active Cosmetics segment targets dermatological skincare markets, often distributed through pharmacies and medical professionals. Strategic acquisitions, partnerships, and a robust global supply chain further enhance L'Oreal's market position and revenue potential.
L'Oreal Earnings Call Summary
Earnings Call Date:Feb 06, 2025
(Q4-2024)
| % Change Since: 18.59%|
Next Earnings Date:Jul 29, 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.Q4-2024 Updates
Positive Updates
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.
Negative Updates
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.L'Oreal Financial Statement Overview
Summary
L'Oreal has demonstrated strong financial performance with consistent revenue growth, impressive gross profit margins, and effective cost management, resulting in a robust net profit margin. The balance sheet is solid with a manageable debt-to-equity ratio and healthy ROE, while cash flow generation remains strong, supporting financial flexibility.Income Statement
L'Oreal has shown strong financial performance with consistent revenue growth, increasing from $27.99 billion in 2020 to $43.49 billion in 2024, and impressive gross profit margins over 74% for the recent year. The net profit margin improved to 14.74% in 2024, indicating effective cost management and profitability. EBIT and EBITDA margins are robust, reflecting efficient operations.85
Very Positive
Balance Sheet
The balance sheet is solid with a consistent increase in stockholders' equity to $33.13 billion by 2024. The debt-to-equity ratio is manageable at 0.26, suggesting conservative leverage. Return on Equity (ROE) is healthy at 19.34% in 2024, indicating effective use of equity. The equity ratio remains strong, showcasing financial stability.78
Positive
Cash Flow
Cash flow from operations has been strong, reaching $8.29 billion in 2024, and free cash flow has grown significantly, highlighting robust cash generation capability. The free cash flow to net income ratio is stable, indicating efficient cash conversion, while the operating cash flow to net income ratio exceeds 1, demonstrating sound cash flow management.82
Very Positive
| Breakdown | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 43.49B | 41.18B | 38.26B | 32.29B | 27.99B |
| Gross Profit | 32.26B | 30.42B | 27.36B | 23.82B | 20.47B |
| EBITDA | 10.67B | 9.66B | 9.16B | 7.54B | 6.47B |
| Net Income | 6.41B | 6.18B | 5.71B | 4.60B | 3.56B |
Balance Sheet | |||||
| Total Assets | 56.35B | 51.86B | 46.84B | 43.01B | 43.61B |
| Cash, Cash Equivalents and Short-Term Investments | 4.08B | 4.32B | 2.62B | 2.71B | 6.41B |
| Total Debt | 8.49B | 8.69B | 5.65B | 6.30B | 2.55B |
| Total Liabilities | 23.22B | 22.77B | 19.66B | 19.42B | 14.61B |
| Stockholders Equity | 33.13B | 29.07B | 27.18B | 23.59B | 28.99B |
Cash Flow | |||||
| Free Cash Flow | 6.64B | 6.12B | 4.93B | 5.65B | 5.48B |
| Operating Cash Flow | 8.29B | 7.60B | 6.28B | 6.73B | 6.45B |
| Investing Cash Flow | -3.70B | -4.14B | -2.22B | -1.63B | -2.64B |
| Financing Cash Flow | -4.79B | -1.61B | -4.08B | -8.86B | -2.59B |
L'Oreal Technical Analysis
Neutral
85.42
Price Trends
85.82
Negative
81.84
Positive
78.07
Positive
Market Momentum
0.59
Negative
47.35
Neutral
17.98
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LRLCY, the sentiment is Neutral. The current price of 85.42 is below the 20-day moving average (MA) of 85.79, below the 50-day MA of 85.82, and above the 200-day MA of 78.07, indicating a neutral trend. The MACD of 0.59 indicates Negative momentum. The RSI at 47.35 is Neutral, neither overbought nor oversold. The STOCH value of 17.98 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for LRLCY.
L'Oreal Peers Comparison
Overall Rating
UnderperformOutperform
Sector (65)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $231.78B | 33.71 | 20.87% | 1.82% | 5.65% | 3.79% | |
71 Outperform | $149.30B | 24.46 | 30.53% | 3.41% | 1.99% | -10.59% | |
66 Neutral | $72.01B | 25.16 | 977.07% | 2.34% | 0.98% | 12.12% | |
65 Neutral | $360.50B | 24.42 | 30.29% | 2.75% | -0.16% | 2.74% | |
65 Neutral | $26.97B | 15.50 | -4.18% | 3.32% | 1.01% | 1.53% | |
61 Neutral | $32.77B | 147.29 | -17.27% | 1.56% | -3.70% | -235.59% | |
60 Neutral | $4.41B | 40.12 | -10.58% | ― | -1.68% | -302.11% |
* Consumer Defensive Sector Average
Performance Comparison
LRLCY
L'Oreal
85.42
-2.81
-3.18%
CL
Colgate-Palmolive
88.15
-9.14
-9.39%
EL
The Estée Lauder Companies
86.10
-12.39
-12.58%
PG
Procter & Gamble
152.68
-12.72
-7.69%
UL
Unilever
60.26
3.91
6.94%
COTY
Coty
4.92
-5.15
-51.14%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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.