NEW YORK - The Estée Lauder Companies Inc. (NYSE: EL), a leading global manufacturer and marketer of skin care, makeup, fragrance, and hair care products, has announced the appointment of Akhil Shrivastava as Executive Vice President and Chief Financial Officer. Shrivastava will succeed Tracey T. Travis, who had previously announced her retirement plans on July 11, 2024. The transition will take place on November 1, 2024, with Travis continuing her tenure at the company until June 30, 2025, to ensure a smooth handover.
Shrivastava brings over 25 years of financial and leadership experience to his new role. He joined Estée Lauder in 2015 and has since held several senior finance positions within the company. Most recently, he served as Senior Vice President, Corporate Controller, and has been instrumental in strategic financial planning and operational excellence initiatives. In his new capacity, Shrivastava will oversee the company's Global Finance, Accounting, Tax, Treasury, Investor Relations, and New Business Development organizations.
Fabrizio Freda, President and CEO of Estée Lauder, expressed confidence in Shrivastava's ability to drive the company's strategic direction, citing his financial and strategic expertise as key to supporting Estée Lauder's goals for sustainable profitability and sales growth acceleration. William P. Lauder, Executive Chairman, also praised Shrivastava's leadership qualities and his focus on consumer-centric strategies that will contribute to the company's long-term objectives.
Before his tenure at Estée Lauder, Shrivastava spent eighteen years at Procter & Gamble in various finance and leadership roles, including Finance Director for Gillette, North America. He holds a Master's Degree in Finance and Control from Delhi University.
In other recent news, Estee Lauder (NYSE:EL)'s financial performance has been a focus of recent developments. The company's sales growth forecast was revised to a 5% increase from the previously projected 7%, and the non-GAAP earnings per share (EPS) estimate for FY25 was adjusted to $3.90 from $4.15. In addition, Estee Lauder completed its acquisition of DECIEM Beauty Group, a strategic expansion of its skincare portfolio, with a total investment net of cash amounting to approximately $1.7 billion over three tranches.
Estee Lauder also experienced a downgrade from Raymond James from Strong Buy to Market Perform amid slower recovery in key markets like China and the U.S. Analysts at TD Cowen maintained a Hold rating on Estee Lauder shares, suggesting the company's need for a more customer-centric approach and a stronger presence in the fragrances and hair product sectors. Barclays (LON:BARC) also lowered its price target for Estee Lauder to $136 from $140, maintaining an Equalweight rating due to cautiousness about the company's growth potential.
In other company news, TOM FORD announced the departure of Peter Hawkings from his role as Creative Director. The Spring-Summer 2025 collection, which is still under Hawkings' creative direction, is set to be showcased at the Milan showroom in September 2024. The announcement of a new Creative Director to succeed Hawkings is expected to be made shortly. These are the recent developments shaping both companies' positions in their respective industries.
InvestingPro Insights
As The Estée Lauder Companies Inc. (NYSE: EL) prepares for a strategic leadership transition with Akhil Shrivastava stepping into the role of CFO, the financial landscape of the company provides an interesting backdrop. With a robust market capitalization of $35.82 billion, Estée Lauder stands as a significant player in the luxury and prestige brand market. Investors may find Estée Lauder's impressive gross profit margins noteworthy, with the last twelve months as of Q3 2024 showing a substantial 70.77%, reflecting the company's ability to maintain premium pricing and manage production costs effectively.
Despite the change in CFO, Estée Lauder has demonstrated a commitment to shareholder returns, maintaining dividend payments for 29 consecutive years, and currently offering a dividend yield of 2.61%. This consistency is a testament to the company's financial stability and long-term approach to capital management. For those interested in Estée Lauder's stock performance, it's worth noting that the company is trading near its 52-week low, with the price at the previous close standing at $101.04. This could potentially signal a buying opportunity for investors who believe in the company's fundamentals and long-term growth prospects.
For a deeper dive into Estée Lauder's financial health and future outlook, investors can explore additional InvestingPro Tips that cover aspects such as earnings revisions by analysts and valuation multiples. Currently, there are 7 analysts who have revised their earnings downwards for the upcoming period, suggesting potential challenges ahead. Moreover, Estée Lauder is trading at a high earnings multiple with a P/E ratio of 55.99, which could indicate expectations of continued earnings growth or a premium being placed on the stock due to its market position.
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