Coty (NYSE:COTY) Posts Earnings Results, Beats Estimates By $0.04 EPS

Coty (NYSE:COTY) released its quarterly earnings results on Wednesday. The company reported $0.16 EPS for the quarter, topping analysts’ consensus estimates of $0.12 by $0.04, FiscalAI reports. Coty had a negative net margin of 10.42% and a positive return on equity of 5.68%. The firm had revenue of $1.56 billion during the quarter, compared to analysts’ expectations of $1.53 billion. During the same period in the previous year, the company earned $0.12 EPS. The firm’s revenue for the quarter was down 1.4% compared to the same quarter last year.

Here are the key takeaways from Coty’s conference call:

• Coty’s first-quarter results beat expectations: like-for-like revenue declined 1.6%, a smaller drop than the company had guided, and adjusted EBITDA was $274 million. Management cautioned that fiscal 2027 remains a transition year and recovery may not be linear.
• Coty continued to trail its markets in sell-out: Prestige declined 2% against 3% market growth, while Consumer Beauty fell 3% as its market grew 5%. The top six Prestige brands returned to sell-out growth, but management said more improvement is needed to lift division-wide performance.
• Adjusted EBITDA fell 7% year over year, and gross margin declined 120 basis points to 63.3%, pressured by higher freight and material costs, excess and obsolete inventory, and unfavorable mix. Coty expects a high-single-digit EBITDA decline in Q2 and said elevated Middle East-related costs may persist through the rest of fiscal 2027.
• Free cash flow rose $73 million year over year to $85 million, and net debt fell about $300 million from June to approximately $2.6 billion, or 3.1 times leverage. The company attributed the debt reduction partly to cash flow and $250 million in proceeds related to the Gucci transition; it expects more than $300 million of free cash flow in the first half.
• More concentrated investment showed early traction: Coty’s six core Prestige brands grew 5% in the quarter, with five of the six growing, and launches including Marc Jacobs Beauty were tracking ahead of plan. Management expects continued growth from the core six in Q2, but at a more moderate pace, and remains committed to completing its strategic review by the end of 2026.

Coty Trading Up 12.8%

NYSE:COTY traded up $0.45 during midday trading on Thursday, hitting $3.92. The stock had a trading volume of 9,925,226 shares, compared to its average volume of 8,710,253. The stock has a 50-day moving average of $2.89 and a 200 day moving average of $2.54. The company has a market capitalization of $3.45 billion, a price-to-earnings ratio of -5.56, a PEG ratio of 0.64 and a beta of 0.83. Coty has a one year low of $1.82 and a one year high of $4.16. The company has a quick ratio of 0.42, a current ratio of 0.75 and a debt-to-equity ratio of 0.96.

Analysts Set New Price Targets

A number of research firms recently issued reports on COTY. Deutsche Bank Aktiengesellschaft restated a “hold” rating and set a $3.00 price objective on shares of Coty in a report on Friday, August 21st. Zacks Research downgraded Coty from a “hold” rating to a “strong sell” rating in a research report on Monday, October 26th. TD Cowen assumed coverage on shares of Coty in a report on Friday, October 30th. They issued a “hold” rating on the stock. Royal Bank Of Canada cut shares of Coty from an “outperform” rating to a “sector perform” rating and set a $3.00 price target on the stock. in a report on Thursday, August 20th. Finally, Jefferies Financial Group lifted their price objective on shares of Coty from $2.40 to $2.95 and gave the company a “buy” rating in a report on Monday, October 19th. One analyst has rated the stock with a Buy rating, nine have issued a Hold rating and three have given a Sell rating to the stock. Based on data from MarketBeat, the company currently has a consensus rating of “Reduce” and an average target price of $3.21.

Key Stories Impacting Coty

Here are the key news stories impacting Coty this week:

• Positive Sentiment: Coty reported earnings of $0.16 per share versus the $0.12 consensus estimate, and revenue of $1.56 billion versus expectations of $1.53 billion. The company also said adjusted EBITDA and free cash flow were ahead of expectations. Coty Q1 fiscal 2027 results
• Positive Sentiment: Coty secured a 40-year extension of its Marc Jacobs beauty license, keeping a key prestige fragrance brand in its portfolio for the long term. Marc Jacobs Beauty license extension
• Negative Sentiment: Revenue declined 1.4% year over year, and Coty forecast soft second-quarter profit as higher costs weigh on its turnaround efforts. That outlook could offset the quarterly beat. Coty forecasts soft second-quarter profit

Coty Company Profile

Coty Inc is a global beauty company that develops, manufactures and markets fragrances, cosmetics, skin care and body-care products. Its portfolio includes luxury, prestige and mass-market brands, with products sold through department stores, specialty retailers, e-commerce platforms and other distribution channels.

The company’s brands have included CoverGirl, Rimmel London, Max Factor, Bourjois, Gucci Beauty, Calvin Klein, Marc Jacobs, Burberry, Hugo Boss and Chloé, among others. Coty also participates in professional beauty through hair-care and salon brands, including the Wella portfolio.

Founded in Paris in 1904 by François Coty, the company built its early reputation in fragrance before expanding into broader beauty categories and international markets.