Oppenheimer Reiterating Underperform On Estee Lauder (EL)

Oppenheimer & Co. has an Underperform rating on The Estee Lauder Companies Inc. EL, despite reporting a much better than expected earnings. In a note to clients, Oppenheimer writes, "Estee Lauder's F1Q results were much better than expected, with 14% local sales and adjusted EPS growth both well ahead of expectations, driven by strength across categories and geographies. In addition, management raised its F11 adjusted EPS guidance to $2.90-3.10 vs. $2.80-3.05 prior, although this was largely reflected in Street estimates. Despite the very strong quarter, we are reiterating our Underperform rating on EL as we remain concerned about the sustainability of this resurgence in global beauty, while the stock appears already to reflect a realistic bull case for this year." Shares of EL gained $6.76 on Friday to close at $71.17, a gain of 10.5%.