Paul J. Fribourg, a director at Estee Lauder Companies Inc. (NYSE:EL), has acquired a substantial number of shares in the company, according to a recent SEC filing. Between November 13 and November 14, Fribourg purchased a total of 157,000 shares of Estee Lauder's Class A Common Stock. The transactions, executed through Continental Grain Company, were completed at a price range of $63.18 to $64.99 per share, amounting to a total investment of approximately $10,045,534.
These purchases reflect Fribourg's continued interest in the company, where he holds a significant position. The shares are indirectly owned by Continental Grain Company, where Fribourg serves as Chairman and CEO. The transactions have increased Fribourg's total holdings in Estee Lauder to 157,000 shares, further solidifying his stake in the cosmetics giant.
In other recent news, Estée Lauder Companies Inc. has reported a 5% decline in organic sales in the first quarter of fiscal 2025, primarily due to downturns in mainland China, global travel retail, and Hong Kong SAR. Despite these challenges, the company achieved a 1% global sales growth when excluding these regions. Adjusted earnings per share reached $0.14, surpassing the previous year's $0.11. However, the company has withdrawn its full-year outlook for fiscal 2025 and reduced its quarterly dividend from $0.66 to $0.35 per share.
In response to these financial results, analyst firms B.Riley, TD Cowen, and Telsey Advisory Group reduced their price targets, while JPMorgan (NYSE:JPM) downgraded the stock from Overweight to Neutral. These changes reflect concerns about Estée Lauder's performance, particularly in the Asia-Pacific region.
In terms of governance, Estée Lauder announced the reelection of its Board of Directors and the ratification of its independent auditors, PricewaterhouseCoopers LLP. Additionally, the company has undergone significant leadership changes, with Stéphane de La Faverie appointed as the new President and CEO, effective January 1, 2025, and Akhil Shrivastava taking over as CFO. The company also announced amendments to its Share Incentive Plan, extending it until November 8, 2034, and increasing the number of shares available for issuance by 12 million.
InvestingPro Insights
Paul J. Fribourg's recent substantial share purchase in Estee Lauder Companies Inc. (NYSE:EL) comes at a time when the stock appears to be trading at attractive levels. According to InvestingPro data, Estee Lauder's stock is currently trading near its 52-week low, with a significant price decline of 31.36% over the past three months and 51.72% over the last six months.
This insider buying activity aligns with an InvestingPro Tip suggesting that the stock's Relative Strength Index (RSI) indicates it may be in oversold territory. This could potentially signal a buying opportunity for investors who share Fribourg's confidence in the company's long-term prospects.
Despite recent challenges, Estee Lauder maintains impressive gross profit margins of 72.36% for the last twelve months as of Q1 2023, showcasing the company's pricing power and operational efficiency. Additionally, an InvestingPro Tip highlights that Estee Lauder has maintained dividend payments for 29 consecutive years, demonstrating a commitment to shareholder returns even in challenging times.
For investors seeking a more comprehensive analysis, InvestingPro offers 12 additional tips for Estee Lauder, providing a deeper understanding of the company's financial health and market position.
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