EL
The Estée Lauder Companies Inc.
$88.32
Stable Earnings Power
40%
P/Adj-EPS × Normalized Multiple
Moderate
·
Conviction
Overvalued
Trading 16.2% above fair value
You pay
$88.32
Bear
$62.60
Fair
$76.01
Bull
$89.42
Bear
$62.60
-29.1%
$3.79 × 14x P/E
Fair
$76.01
-13.9%
$3.79 × 17x P/E
Bull
$89.42
+1.2%
$3.79 × 20x P/E
Key Value Driver
Normalized P/E multiple (17x base case)
Implied Market Multiple
23.3x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $102.86 from 46 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $76.01 per share.
Warnings
Wall Street's average price target is $102.86 (from 46 analysts). Our estimate is 37% below the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples