While there was some doubt about whether or not the beauty market might be able to stage a recovery, the latest signs for beauty company Coty (NYSE:COTY) suggest that there could be room for pleasant fragrances once more. An analyst’s upgrade gave that notion more weight, causing shares to climb over 2% in Thursday afternoon’s trading.
TD Cowen, via analyst Oliver Chen and team, hiked its outlook and the price target on Coty. Chen et al. upgraded the stock from Market Perform to Outperform and boosted the price target by 23% to $16 per share. While indeed, macroeconomics could mean trouble for Coty, TD Cowen looks for new opportunities to step in and fill that gap. Further, recent cost savings measures will take the strain off margins and give Coty extra room to run.
Making a Greater Push
That’s all certainly welcome news, and there was better afoot. Coty recently hit the Consumer Analyst Group of New York (CAGNY) conference to deliver remarks about its latest quarter and future plans, including a means to take on potential macroeconomic issues by focusing on “life’s little luxuries.” Also, while at the CAGNY event, Coty revealed that it set up a long-term licensing deal with Etro, an Italian brand, that should give it more reach in the field. Plus, the two are set to work together on whole new lines and categories to drive further revenue growth.
What Is the Target Price for COTY?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on COTY stock based on five Buys and five Holds assigned in the past three months, as indicated by the graphic below. After a 13.53% rally in its share price over the past year, the average COTY price target of $13.94 per share implies 7.73% downside risk.
