Estee Lauder Cos Recent Insider Activity

Tracey Thomas Travis, EVP & CFO at Estee Lauder Cos EL, executed a substantial insider sell on May 16, according to an SEC filing.

What Happened: Travis opted to sell 14,493 shares of Estee Lauder Cos, according to a Form 4 filing with the U.S. Securities and Exchange Commission on Thursday. The transaction's total worth stands at $1,967,134.

Estee Lauder Cos shares are trading down 0.54% at $135.26 at the time of this writing on Thursday morning.

Delving into Estee Lauder Cos's Background

Estee Lauder is a leader in the global prestige beauty market, participating across skin care (52% of 2023 sales), makeup (28%), fragrance (16%), and hair care (4%) categories, with top-selling brands such as Estee Lauder, Clinique, M.A.C, La Mer, Jo Malone London, Aveda, Bobbi Brown, and Origins. The firm operates in more than 150 countries, generating 28% of revenue from the Americas, 39% from Europe, the Middle East and Africa (including travel retail), and 33% from Asia-Pacific. Estee Lauder sells its products through department stores, travel retail, specialty multibrand beauty stores, brand-dedicated freestanding stores, e-commerce, salons/spas, and perfumeries.

Breaking Down Estee Lauder Cos's Financial Performance

Revenue Growth: Estee Lauder Cos's remarkable performance in 3 months is evident. As of 31 March, 2024, the company achieved an impressive revenue growth rate of 5.04%. This signifies a substantial increase in the company's top-line earnings. In comparison to its industry peers, the company trails behind with a growth rate lower than the average among peers in the Consumer Staples sector.

Key Profitability Indicators:

• Gross Margin: The company excels with a remarkable gross margin of 71.9%, indicating superior cost efficiency and profitability compared to its industry peers.

• Earnings per Share (EPS): Estee Lauder Cos's EPS outshines the industry average, indicating a strong bottom-line trend with a current EPS of 0.92.

Debt Management: Estee Lauder Cos's debt-to-equity ratio is notably higher than the industry average. With a ratio of 1.71, the company relies more heavily on borrowed funds, indicating a higher level of financial risk.

In-Depth Valuation Examination:

• Price to Earnings (P/E) Ratio: A higher-than-average P/E ratio of 76.4 suggests caution, as the stock may be overvalued in the eyes of investors.

• Price to Sales (P/S) Ratio: A higher-than-average P/S ratio of 3.2 suggests overvaluation in the eyes of investors, considering sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): A high EV/EBITDA ratio of 24.97 positions the company as being more valued compared to industry benchmarks.

Market Capitalization Analysis: With a profound presence, the company's market capitalization is above industry averages. This reflects substantial size and strong market recognition.

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Exploring the Significance of Insider Trading

While insider transactions should not be the sole basis for making investment decisions, they can play a significant role in an investor's decision-making process.

From a legal standpoint, the term "insider" pertains to any officer, director, or beneficial owner holding more than ten percent of a company's equity securities as outlined in Section 12 of the Securities Exchange Act of 1934. This encompasses executives in the c-suite and significant hedge funds. These insiders are mandated to inform the public of their transactions through a Form 4 filing, to be submitted within two business days of the transaction.

A company insider's new purchase is a indicator of their positive anticipation for a rise in the stock.

While insider sells may not necessarily reflect a bearish view and can be motivated by various factors.

Navigating the World of Insider Transaction Codes

Examining transactions, investors often concentrate on those unfolding in the open market, meticulously detailed in Table I of the Form 4 filing. A P in Box 3 denotes a purchase, while S signifies a sale. Transaction code C indicates the conversion of an option, and transaction code A denotes a grant, award, or other acquisition of securities from the company.

Check Out The Full List Of Estee Lauder Cos's Insider Trades.

This article was generated by Benzinga's automated content engine and reviewed by an editor.