EL
The Estée Lauder Companies Inc.
$94.32
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Strong
·
Conviction
Overvalued
Trading 117.1% above fair value
You pay
$94.32
Bear
$35.78
Fair
$43.45
Bull
$51.12
Bear
$35.78
-62.1%
$2.56 × 14x P/E
Fair
$43.45
-53.9%
$2.56 × 17x P/E
Bull
$51.12
-45.8%
$2.56 × 20x P/E
Adjust Assumptions
17.0x
2.56$
Key Value Driver
Normalized P/E multiple (17x base case)
Implied Market Multiple
36.9x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (46 analysts)
$103.00
Divergence from AlphaVal
58%
Summary
Applying a 17x P/E to adjusted EPS of $2.56, the base-case value is $43.45 per share.
Warnings
The company's reported profits differ from official accounting profits by 411%. Check what costs are being left out of the adjusted number.
The company pays out 280% of its profits as dividends. That leaves little cushion — the dividend could be cut if business slows down.
Wall Street's average price target is $103.00 (from 46 analysts). Our estimate is 58% 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