4 Cosmetics Stocks Worth Watching Despite Industry Challenges

Zacks11-06

Companies in the Zacks Cosmetics industry are facing challenges due to a tough consumer environment, with inflationary pressures causing consumers to become more selective in their spending habits. As...

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As...</p>\n\n<a href=\"https://finance.yahoo.com/news/4-cosmetics-stocks-worth-watching-130900490.html\">Source Link</a>\n\n</div>\n","source":"yahoofinance","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>4 Cosmetics Stocks Worth Watching Despite Industry Challenges</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\n4 Cosmetics Stocks Worth Watching Despite Industry Challenges\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-11-06 21:09 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://finance.yahoo.com/news/4-cosmetics-stocks-worth-watching-130900490.html><strong>Zacks</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Companies in the Zacks Cosmetics industry are facing challenges due to a tough consumer environment, with inflationary pressures causing consumers to become more selective in their spending habits. As...</p>\n\n<a href=\"https://finance.yahoo.com/news/4-cosmetics-stocks-worth-watching-130900490.html\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"BK4191","symbol_name":"家用电器","start_time":0,"source_url":"https://finance.yahoo.com/news/4-cosmetics-stocks-worth-watching-130900490.html","article_id":"2481498913","we_media_id":null,"thumbnails":["https://s.yimg.com/uu/api/res/1.2/AlIC6SpTAR5OyZW2dRprlw--~B/aD00MDA7dz02MzU7YXBwaWQ9eXRhY2h5b24-/https://media.zenfs.com/en/zacks.com/e01e7f1bc7b30a9bea4c2be198de1e54"],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2481498913","pubTimestamp":1730898540,"sourceInfo":{"source_id":"yahoofinance","name":"雅虎金融"},"weMediaInfo":null,"summary":"Companies in the Zacks Cosmetics industry are facing challenges due to a tough consumer environment, with inflationary pressures causing consumers to become more selective in their spending habits. As a result, many beauty industry players are experiencing a decline in consumer demand. In addition, companies in the cosmetics sector are grappling with escalated production costs, further impacting their profitability and operational efficiency.Despite these challenges, companies like Coty Inc. COTY, Helen of Troy Limited HELE, European Wax Center, Inc. EWCZ and Nu Skin Enterprises, Inc. NUS have seen positive results from initiatives focused on enhancing digital capabilities and driving innovation.Trends Shaping the Future of the Cosmetics Industry","collect":0,"end_time":0,"defaultTopTitle":"yahoo.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"BK4191":"家用电器","HELE":"海伦特洛伊家电","EWCZ":"European Wax Center, Inc.","BK4585":"ETF&股票定投概念","NUS":"如新集团","IE00B19Z3581.USD":"Legg Mason ClearBridge - Value A Acc USD","LU2065732104.USD":"ALLSPRING (LUX) WF GLOBAL SMALL CAP EQUITY \"I\" (USD) ACC","IE0002270589.USD":"LEGG MASON CLEARBRIDGE VALUE \"A\" (USD) INC","IE00B19Z3B42.SGD":"Legg Mason ClearBridge - Value A Acc SGD","IE00B7SZLL34.SGD":"Legg Mason ClearBridge - Value A Acc SGD-H","BK4539":"次新股","BK4532":"文艺复兴科技持仓","COTY":"科蒂","BK4192":"特殊消费者服务","BK4183":"个人用品"},"translate_title":"尽管面临行业挑战，4只值得关注的化妆品股","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"COTY":1,"EWCZ":1,"HELE":1,"NUS":0.9},"content_text":"Companies in the Zacks Cosmetics industry are facing challenges due to a tough consumer environment, with inflationary pressures causing consumers to become more selective in their spending habits. As a result, many beauty industry players are experiencing a decline in consumer demand. In addition, companies in the cosmetics sector are grappling with escalated production costs, further impacting their profitability and operational efficiency.Despite these challenges, companies like Coty Inc. COTY, Helen of Troy Limited HELE, European Wax Center, Inc. EWCZ and Nu Skin Enterprises, Inc. NUS have seen positive results from initiatives focused on enhancing digital capabilities and driving innovation.\nAbout the Industry\nThe Zacks Cosmetics industry includes companies that provide beauty and personal care products. Players in the industry manufacture, distribute, sell and market skincare, fragrance, makeup and hair care products. Many firms in the market sell products via sales representatives, whereas some do the same through retailers, independent and chain drug stores and pharmacies, upscale perfumeries, department stores and beauty salons. These companies also operate through retailer websites, third-party distributors and in-flight and duty-free shops. Some products offered by industry participants include moisturizers, serums, toners and cleansers under skincare; perfume sprays, candles and soaps under fragrance; lipsticks, mascaras, powders, eye shadows, foundation and nail polishes under makeup; and shampoos, conditioner and hair color products under hair care.\nTrends Shaping the Future of the Cosmetics Industry\nTough Economic Landscape: Cosmetic companies are navigating a turbulent economic environment stemming from underlying inflationary pressures. Elevated costs for packaging, ingredients, and transportation are increasing production expenses and eroding profit margins. At the same time, shifting consumer behavior is complicating matters further. As a result of heightened living costs, consumers are becoming more selective with their purchases, focusing on essential goods while cutting back on non-essential items like cosmetics. This trend is creating a challenging demand environment for several cosmetic companies as they navigate higher operational costs and changing consumer priorities in this highly competitive beauty space.International Risk Factors: Several industry players face potential risks due to their global footprint, including exposure to adverse foreign currency fluctuations. Political unrest, like turmoil related to geopolitical events, might disrupt market access and operational continuity. Trade conflicts, tariffs, sanctions and other restrictions may also affect their performance.Innovation & Digitization - Major Drivers: Innovation and digitization are driving growth in the beauty and skincare industry. Consumers are increasingly drawn to unique products that blend cutting-edge technology with expert scientific formulations. To meet these evolving demands, cosmetic companies are constantly innovating and launching new offerings. The rising consumer interest in organic and clean beauty products has further fueled market growth. Enhancing e-commerce capabilities is a key priority, with advancements like virtual try-on tools, seamless digital payment systems, and enhanced online marketing strategies gaining traction. Additionally, many beauty brands are expanding their product portfolios through strategic acquisitions and partnerships to stay competitive in a fast-evolving market.\nZacks Industry Rank Indicates Dull Prospects\nThe Zacks Cosmetics industry is housed within the broader Zacks Consumer Staples sector. The industry currently carries a Zacks Industry Rank #204, which places it in the bottom 19% of more than 250 Zacks industries.The group’s Zacks Industry Rank, which is basically the average of the Zacks Rank of all the member stocks, indicates drab near-term prospects. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than two to one.The industry’s position in the bottom 50% of the Zacks-ranked industries leads to a negative aggregate earnings outlook for the constituent companies. Looking at the aggregate earnings estimate revisions, it appears that analysts are gradually losing confidence in this group’s earnings growth potential. Since the beginning of September 2024, the industry’s consensus estimate for current financial year earnings has decreased 9.8%.Before we present a few stocks that you may want to consider for your portfolio, let’s look at the industry’s recent stock-market performance and valuation picture.\nIndustry Vs. Broader Market\nThe Zacks Cosmetics industry has underperformed the Zacks S&P 500 composite and the broader Zacks Consumer Staples sector over the past year.The industry has declined 35.6% over this period against the S&P 500’s growth of 30.7%. The broader sector has gained 7.6% in the said time frame.\nOne-Year Price Performance\n\nIndustry's Current Valuation\nOn the basis of forward 12-month Price-to-earnings (P/E), which is commonly used for valuing consumer staples stocks, the industry is currently trading at 20.99X compared with the S&P 500’s 21.60X and the sector’s 17.44X.In the past five years, the industry has traded as high as 43.68X and as low as 20.99X, with the median being 31.84X, as the chart below shows.\nPrice-to-Earnings Ratio (Past 5 Years)\n\n4 Cosmetics Stocks Worth Watching\nCoty: This manufacturer, marketer and distributor of beauty products carries a Zacks Rank #3 (Hold). Coty continues to benefit from robust growth in the global beauty market, driven by a strong brand presence and consumer demand for fragrances, cosmetics and skincare. With a focus on six growth pillars, including growing Consumer Beauty and fragrances, the company demonstrates a proactive approach to sustainable growth. By investing in core categories like skincare and expanding its e-commerce capabilities, COTY aligns with evolving consumer preferences.  You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Coty’s commitment to innovation and strategic partnerships enhances its competitive position across the beauty market. In addition, management is progressing well with the All In to Win transformation program across five key work areas, driving notable improvement in cost, gross margins, sales growth and cash. The Zacks Consensus Estimate for COTY’s current fiscal year earnings per share (EPS) has moved down by a penny in the past 30 days at 55 cents. Coty’s shares have dropped 23.9% in the past year.\nPrice and Consensus: COTY\n\nHelen of Troy: This provider of consumer products across Beauty, Housewares and Health & Home segments carries a Zacks Rank of 3. Helen of Troy has demonstrated its commitment to growth by focusing on brand revitalization, marketing effectiveness, and innovation across home, outdoor, beauty, and wellness categories. The company is investing in its Leadership Brands, a portfolio of market-leading brands. Significant expansion in key international markets and the optimization of distribution networks are expected to bolster HELE’s future sales performance. In addition, Helen of Troy’s global restructuring plan, Project Pegasus, is designed to improve efficiency and reduce costs.The Zacks Consensus Estimate for Helen of Troy’s current fiscal year EPS has moved up by a couple of cents in the past 30 days at $7.18. The stock has dropped 35.6% in the past year.\nPrice and Consensus: HELE\n\nEuropean Wax Center, Inc.: The largest and fastest-growing franchisor and operator of out-of-home waxing services in the United States carries a Zacks Rank #3. The company’s franchise partners remain highly committed to long-term development, providing a solid foundation for continued expansion. EWCZ has successfully utilized advanced data analytics to optimize its marketing strategies and enhance return on investment.European Wax Center has launched key initiatives like Operation Elevate, which focuses on improving the performance of select centers through targeted training, coaching, and development. EWCZ’s laser hair removal pilot program is also proving to be a valuable addition, expanding its service offerings and driving growth. The Zacks Consensus Estimate for European Wax’s current fiscal year EPS has remained unchanged in the past 30 days at 32 cents. EWCZ’s stock has declined 49% in the past year.\nPrice and Consensus: EWCZ\n\nNu Skin: This Zacks Rank #3 company develops and distributes a wide range of premium cosmetics, beauty, personal care and wellness products. Nu Skin is driving market expansion through strategic initiatives designed to boost brand presence and capture new opportunities. These efforts include integrated marketing strategies, a stronger digital presence, and partnerships with third-party marketplaces to enhance customer engagement and conversion. The company is also focusing on expanding into emerging markets, leveraging localized products and tailored business strategies to meet the specific needs of these regions.With the use of cutting-edge technology and well-planned product programs, Nu Skin aims to increase its market share while maintaining steady growth. A key element of the company's strategic vision is its Rhyz business, which has shown remarkable growth and now plays a vital role in its revenue generation. The Zacks Consensus Estimate for NUS’ current fiscal year earnings has remained unchanged at 78 cents in the past 30 days. Shares of Nu Skin have declined 62.7% in the past year.\nPrice and Consensus: NUS\n\nWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report\nCoty (COTY) : Free Stock Analysis Report\nHelen of Troy Limited (HELE) : Free Stock Analysis Report\nNu Skin Enterprises, Inc. (NUS) : Free Stock Analysis Report\nEuropean Wax Center, Inc. (EWCZ) : Free Stock Analysis Report\nTo read this article on Zacks.com click here.\nZacks Investment Research","kind":"highlight","is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"0","news_tag":"","news_rank":0,"symbols":[],"gpt_button":1},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.3","shortVersion":"4.29.3","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2481498913"}