L'Oréal: Credit Suisse downgrades stock, cuts target price

(CercleFinance.com) - Credit Suisse has downgraded its recommendation on the L'Oréal share to underperform (vs.
neutral), while cutting its target price to 225 euros (against 230 euros).

" We now anticipate a 5.6% decline in L'Oréal's LFL sales this year, followed by a 9.8% increase in FY21, a 2-year stacked growth rate of 4.2% versus 9.7% previously," Credit Suisse said.

Credit Suisse is now assuming a FY 2021 EBIT margin of 18.3% (vs. 19.0% previously), 30 basis points lower than in FY 2019.

"We also expect a step-up in marketing investment in the face of consumer down-trading (as we saw in 2009) and FY21 margin (CSe 18.3%) to be below FY19," the analyst adds.

At midday on Thursday the share is down about 0.4% at just under 270 euros.


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