5 Best Beauty Stocks To Buy Now

4. The Estée Lauder Companies Inc. (NYSE:EL)

Number of Hedge Fund Holders: 44

Cosmetics company The Estée Lauder Companies Inc. (NYSE:EL) is one of the most popular beauty stocks among the elite hedge funds tracked by Insider Monkey. 44 out of 943 hedge funds in Insider Monkey’s database had stakes in The Estée Lauder Companies Inc. (NYSE:EL) as of the end of the fourth quarter of 2022. The biggest hedge fund stakeholder of The Estée Lauder Companies Inc. (NYSE:EL) was Terry Smith’s Fundsmith LLP which had a $1.4 billion stake in the company. The second biggest stakeholder of The Estée Lauder Companies Inc. (NYSE:EL) was Ken Griffin’s Citadel Investment Group which had a $220 million stake.

In March 2023, TD Cowen analyst Oliver Chen started covering The Estée Lauder Companies Inc. (NYSE:EL) with a Buy rating. The Estée Lauder Companies Inc. (NYSE:EL) said in a note to investors that the company’s brands, customer loyalty and a “long-awaited inflection in demand across the Chinese market” is expected to drive upside for the stock.

ClearBridge All Cap Growth Strategy made the following comment about The Estée Lauder Companies Inc. (NYSE:EL) in its Q4 2022 investor letter:

“The Estée Lauder Companies Inc. (NYSE:EL), which manufactures and markets cosmetics, fragrances, skin and hair care products across a number of well-known global brands including Clinique, MAC and Bobbi Brown, adds to our group of secular growers. Estee Lauder is a global leader in the prestige beauty space, which has outgrown the broader home and personal care category since 2010 and has historically been recession resilient. The company has substantial brand and pricing power and is overindexed to the highly profitable prestige skin care category. We believe the company’s most recent earnings report and 2023 guidance update, which was cut significantly due to uncertainty over China’s zero-COVID policy (China and travel retail are key growth drivers), provided an attractive entry point. At this point, we believe the stock has been significantly derisked and could see potential upside from a China recovery.”