Coty (NYSE:COTY) Issues Quarterly Earnings Results, Misses Expectations By $0.01 EPS

Coty (NYSE:COTY) posted its quarterly earnings data on Wednesday. The company reported ($0.02) EPS for the quarter, missing the consensus estimate of ($0.01) by ($0.01), Zacks reports. The business had revenue of $1.27 billion during the quarter, compared to analysts’ expectations of $1.19 billion. Coty had a negative net margin of 10.42% and a positive return on equity of 5.51%. The company’s revenue for the quarter was up 1.3% compared to the same quarter last year. During the same period in the previous year, the business posted ($0.05) EPS. Coty updated its Q1 2027 guidance to 0.110-0.130 EPS.

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

• Q4 like-for-like sales declined 1%, ahead of Coty’s guidance for a mid-single-digit decline, while adjusted EBITDA and EPS landed at the high end of guidance. Prestige cosmetics delivered double-digit growth, and early recovery signs emerged at Sally Hansen, COVERGIRL, and Rimmel.
• Underlying sell-out remained below market growth in both divisions, with prestige down 1% and consumer beauty down 2% in the second half. Fiscal 2026 adjusted EBITDA fell 22%, while adjusted gross margin declined 190 basis points amid lower volumes, excess inventory, tariffs, and cost pressures.
• Strong cash discipline produced $348 million of fiscal 2026 free cash flow, up approximately $70 million year over year despite the EBITDA decline. Net debt fell nearly $840 million to $2.9 billion, reducing leverage to approximately 3.4 times.
• Fiscal 2027 is expected to be a transition year, and Coty is withholding full-year guidance while its Coty.Curated strategy and strategic review progress. Q1 revenue is expected to decline by a low- to mid-single-digit percentage, with EBITDA down by a low-teens percentage and EPS of $0.11 to $0.13.
• The early Gucci license transition will provide Coty $400 million in cash proceeds plus inventory proceeds, but Gucci represents a low-double-digit percentage of revenue and its fiscal 2028 exit will create a sizable mechanical profit impact. Coty expects leverage to rise in fiscal 2028 even as net debt declines, while it develops cost savings and new launches to restore underlying growth.

Coty Price Performance

Shares of NYSE:COTY opened at $2.75 on Friday. Coty has a twelve month low of $1.82 and a twelve month high of $4.56. The company has a market cap of $2.42 billion, a price-to-earnings ratio of -3.93, a PEG ratio of 0.87 and a beta of 0.97. The business has a 50 day moving average price of $2.44 and a 200 day moving average price of $2.35. The company has a quick ratio of 0.49, a current ratio of 0.82 and a debt-to-equity ratio of 0.97.

Institutional Investors Weigh In On Coty

Institutional investors have recently added to or reduced their stakes in the company. Shay Capital LLC acquired a new stake in Coty during the second quarter worth $46,000. FORA Capital LLC acquired a new position in Coty during the 2nd quarter worth $47,000. Vident Advisory LLC acquired a new position in Coty in the second quarter valued at approximately $50,000. United Capital Financial Advisors LLC acquired a new stake in Coty in the third quarter worth $43,000. Finally, Headlands Technologies LLC bought a new stake in shares of Coty in the second quarter worth about $53,000. 42.36% of the stock is owned by institutional investors and hedge funds.

Wall Street Analysts Forecast Growth

Several research firms have issued reports on COTY. The Goldman Sachs Group reiterated a “neutral” rating and set a $2.60 target price on shares of Coty in a research report on Thursday. Citigroup upped their price objective on Coty from $2.50 to $2.80 and gave the stock a “neutral” rating in a report on Thursday, May 7th. Morgan Stanley set a $2.50 target price on Coty in a research report on Thursday, May 7th. Weiss Ratings reiterated a “sell (e+)” rating on shares of Coty in a research note on Friday, August 7th. Finally, Royal Bank Of Canada lowered Coty from an “outperform” rating to a “sector perform” rating and set a $3.00 price objective for the company. in a research report on Thursday. Fourteen investment analysts have rated the stock with a Hold rating and three have given a Sell rating to the stock. According to data from MarketBeat.com, the company currently has a consensus rating of “Reduce” and an average target price of $3.35.

Trending Headlines about Coty

Here are the key news stories impacting Coty this week:

• Positive Sentiment: Fourth-quarter revenue rose about 1% to $1.27 billion, exceeding analysts’ $1.19 billion estimate. Prestige revenue increased 1%, supported by resilient fragrance demand. Coty also generated $72.6 million in quarterly free cash flow and $348.2 million for fiscal 2026. Coty beats quarterly revenue, calls fiscal 2027 transition year
• Positive Sentiment: The Gucci Beauty license transition is expected to provide Coty with approximately $400 million in proceeds, plus additional inventory proceeds, potentially supporting debt reduction and portfolio investment. Management also outlined a focus on innovation, core brands and long-term portfolio growth through its Coty.Curated strategy. Coty targets portfolio growth by 2028
• Neutral Sentiment: Coty appointed Soraya Benchikh as chief financial officer effective September 1, replacing Laurent Mercier. The leadership change is part of a broader operating-structure overhaul and could improve execution, but it adds management-transition risk during a restructuring period. Coty appoints Soraya Benchikh chief financial officer
• Negative Sentiment: Non-GAAP EPS was a loss of $0.02, missing the $0.01 loss expected by analysts. Coty reported a $144.3 million quarterly net loss, while full-year revenue declined 2% to $5.81 billion. Coty Q4 loss wider than expected
• Negative Sentiment: Management called fiscal 2027 a transition year and forecast first-quarter like-for-like revenue to fall by a low- to mid-single-digit percentage. EPS guidance of $0.11–$0.13 also came in below the roughly $0.14 consensus, while weaker Consumer Beauty demand and margin pressure remain concerns. Coty guides for first-quarter sales decline
• Negative Sentiment: Royal Bank of Canada downgraded Coty from “Outperform” to “Sector Perform,” assigning a $3.00 price target. The downgrade reinforces concerns that strategic changes and margin pressures may limit near-term upside.

About Coty

Coty Inc is a multinational beauty company specializing in the development, manufacturing and marketing of fragrances, color cosmetics and skin and body care products. Established in 1904 by François Coty in Paris, the company has grown through a blend of organic innovation and strategic acquisitions to become one of the leading players in the global beauty industry. Coty’s portfolio encompasses a broad range of consumer and luxury brands, reflecting its commitment to catering to diverse consumer preferences and market segments.

The company’s product offerings span three main divisions: Coty Luxury, Coty Consumer Beauty and Coty Professional Beauty.