Why Estee Lauder Stock Was Smelling Sweet on Thursday

For much of Thursday, Estee Lauder (NYSE: EL) stock was trading in positive territory. This was due in no small part to a recommendation upgrade from an analyst piggybacking on several recent key pieces of news from the company, accompanied by a significant price target bump. Ultimately, the storied cosmetics company's stock closed in negative territory, but only marginally, while the equally well-established S&P 500 index sank by 0.9%.

A post-earnings recommendation change

That upgrade came from Piper Sandler 's Korinne Wolfmeyer, who before market open moved her Estee Lauder recommendation up one peg, from neutral to overweight (buy, in other words). Wolfmeyer also significantly beefed up her target price on the stock, from $95 per share to $114.

The move comes several days after Estee Lauder reported its fiscal fourth quarter of 2024 earnings. Although it topped the consensus analyst estimate for revenue and crushed that for net income, the company's fiscal-year 2025 bottom-line guidance fell well short of the average pundit projection.

In another major development, Estee Lauder announced that long-serving CEO Fabrizio Freda will retire at the end of fiscal 2025.

A bull among bears?

Nevertheless, Wolfmeyer found plenty of reason for optimism on both the company and the wider prestige beauty segment. "We came away from Monday's FQ4 earnings report and estimate reset far more comfortable with current valuation levels and having stronger conviction in updated forward estimates."

It should be noted that the analyst is somewhat of an outlier among her peers. A clutch of them reduced their price targets on the shares, although so far none have modified their recommendations.

Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy .