Estee Lauder Companies Inc.
) is all set to report its first quarter fiscal 2013 results
before the opening bell on November 1, 2012. The Zacks Consensus
Estimate for the quarter is 77 cents (year-over-year decline of
45.4%) on revenues of $2.55 billion (year-over-year increase of
2.8%). The earnings estimate is at the highest end of the
guidance range of 71 cents to 77 cents, which was announced in
the fourth quarter fiscal 2012 conference call.
Fourth Quarter Recap
Estee Lauder's fourth quarter fiscal 2012 adjusted earnings of
17 cents per share climbed 41.7% aided by solid performance in
the U.S. and China and strong sales growth in travel retail. The
earnings inched past the Zacks Consensus Estimate of 16
Net sales for the quarter rose 9% to $2.3 billion and were
slightly ahead of the Zacks Consensus Estimate of $2.2
Gross margin went up 100 basis points (bps) to 80.4% in the
fourth quarter, while operating income margin remained flat at
Agreement of Estimate Revisions
For the first quarter of fiscal 2013, 1 out of 14 estimates
moved upward while one estimate moved downward over the past 30
For fiscal 2013, 4 out of the 16 estimates moved in the
positive direction over the past 30 days, while one moved in the
We believe that the analysts are optimistic on the company's
sales growth across all the geographic regions. Estee Lauder also
expects its first quarter sales to increase. However, higher
operating expenses might offset sales growth.
Magnitude of Estimate Revisions
The Zacks Consensus Estimate for first quarter fiscal 2013 has
remained static over the past 30 days at 77 cents. However, the
fiscal 2012 estimate has increased by a penny from $2.57 to $2.58
per share over the same timeframe.
Over the last four quarters, Estee Lauder has surpassed
estimates thrice and matched once, thereby resulting in an
average earnings surprise of 12.69%. The company recorded a
maximum positive surprise of 16.67% in the first quarter of
New York-based Estee Lauder, which competes with
Procter & Gamble Co.
) and holds a Zacks #3 Rank (short-term Hold rating), is one of
the world's leading manufacturers and marketers of skin care,
makeup, fragrance and hair care products.
We are encouraged by the acquisitions of the Justin Bieber and
Nicky Minaj fragrance brands from Give Back Brands LLC in July,
2012, which will add many famous and popular brands to the
company's portfolio, thereby boosting sales.
However, slow recovering developed economies, tepid growth in
the job market, high interest rates and still tightened credit
availability continues to hurt costumer discretionary
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