Beauty brand Coty (NYSE:COTY) couldn’t keep its feet under it today after new coverage from TD Cowen proved less complimentary than expected. The news was enough to send Coty into a slide, as investors pulled back nearly 2% of its market cap in Wednesday afternoon trading.
TD Cowen, via analyst Oliver Chen, started its coverage of Coty at Market Perform, with a price target of $11, which represents an 11% premium against the closing price on Tuesday. Chen noted that while there are some clear growth opportunities for Coty, there are also plenty of competitors going after that growth. Worse, one of Coty’s primary stocks in trade, fragrances, is actually coming under fire from a market that’s seemingly less in need of fragrances in general.
Interestingly, Coty itself offered something of a roundabout rebuttal to Chen’s assertions, noting that it’s looking for big things in Fiscal Year 2024 thanks to its “prestige business.” Coty pointed out the recent launch of its Burberry Goddess fragrance, which actually proved a winning launch in August, offering up not only a “…unique and sophisticated scent” but also similarly unique and sophisticated packaging. Coty hiked its own projections as a result, looking for sales growth between 10% and 12% in the first half of 2024.
Is COTY Stock a Good Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on COTY stock based on seven Buys and nine Holds assigned in the past three months, as indicated by the graphic below. Furthermore, the average COTY price target of $12.80 per share implies 30.68% upside potential.
