LRLCF - Estée Lauder: Strong FY21 Finish; Double-Digit Growth Resuming
- EL's rebound continued in Q4 FY21, with sales 10% higher than pre-COVID levels; full-year FY21 EPS was 21% higher than FY19.
- Sales recovery was led by China and Skincare already significantly surpassing 2018 levels, with plenty of potential left in other areas.
- Growth in China is supported by government efforts to encourage consumption, and was unaffected by the last anti-corruption drive.
- EL is guiding to a 13-16% EPS growth in FY22, and to the resumption of its traditional double-digit EPS growth algorithm after COVID.
- With shares at $327.40, we expect a total return of 20% by June 2024; with long-term annualized return trending to double digits. Buy.
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Estée Lauder: Strong FY21 Finish; Double-Digit Growth Resuming