LRLCF - L'Oreal Is Overvalued Again
2024-03-19 08:45:25 ET
Summary
- L’Oréal is reporting solid fiscal 2023 results with all four segments contributing to growth.
- And due to market growth, acquisitions and improving margins, we can expect L’Oréal to continue growing in the mid-to-high single digits in the years to come.
- The company is a great business with stable margins and a wide economic moat around the business, but the stock is overvalued.
It has almost been two years since I published my last article about the French consumer goods company L’Oréal S.A. ( OTCPK:LRLCF ). When my last article was published, the stock was very close to a temporary bottom. Nevertheless, I didn’t see the stock as a bargain back then and I wrote:
L'Oreal Is Overvalued AgainL'Oréal is not really overvalued right now. And one might argue that you must pay a premium for great companies and that those stocks are hardly ever cheap. This might be true, and everybody must make that decision for oneself. In my opinion, L'Oréal is still a bit too expensive right now, and considering that we are most likely heading towards a recession, I don't know if right now is the time to buy this undoubtedly great company.