One-glance verdict
Overvalued
$73.11 our estimate vs market $86.25
Wall Street consensus: $103.07 (41.0% higher than our fair-value estimate)
18% above our estimate, beyond the bull case
Fundamentals snapshot
L'Oréal S.A.
LRLCY · PNK · Consumer Defensive · Household & Personal Products
Current price
$86.25
52-week range
$78.82 - $95.48
Market cap
$229.71B
Balance sheet
Watch
23.72x Strong cushion
Net debt $14.55B. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
1 Risk
3 rewards · 1 risks
- Reward Revenue grew 1.3% last year.
- Reward Returns 19.4% on equity, ahead of 50% of its peers.
- Reward Free cash flow was positive in 4/10 years.
- Risk Insider ownership is only 0.0% (peer median: 0.1%).
What this company does
L'Oréal S.A.
L'Oréal is one of the world's largest beauty companies, making everything from makeup and skincare to hair dye under famous brands like Maybelline, Lancôme, and CeraVe. The company earns money by selling these products globally through all kinds of stores, from local pharmacies and high-end department stores to professional hair salons. This wide variety of products and sales outlets is important because it allows L'Oréal to reach many different customers and can provide stability if spending slows down in one part of its business.
How the company got here
L'Oréal started in 1909 with a single, safe hair dye formula created by a young French chemist named Eugène Schueller. He initially sold his products to Parisian hairdressers, but his focus on scientific research and innovation quickly set the company on a path for growth. Over the decades, L'Oréal expanded by acquiring well-known brands like Lancôme, Garnier, and Maybelline, which helped it enter new markets and reach more customers. This strategy of combining in-house scientific development with smart acquisitions turned the small hair dye company into the world's largest cosmetics and beauty company.
What it actually does
L'Oréal makes and sells a huge variety of beauty and personal care products for both women and men. You've likely seen their brands in drugstores, department stores, and salons, including names like L'Oréal Paris, Maybelline, Garnier, Kiehl's, and CeraVe. Their products cover everything from makeup and skincare to hair color, haircare, and fragrances. The company operates globally, selling its products in about 150 countries through many different channels, from high-end stores to local supermarkets and online.
Consumer Products
This is L'Oréal's largest division, offering the brands you see most often in supermarkets and drugstores, like L'Oréal Paris, Garnier, and Maybelline New York. This segment focuses on making beauty products accessible to everyone, covering makeup, skincare, and hair care at affordable prices. These are the everyday items people buy regularly, making this division a huge and steady part of L'Oréal's business. It aims to bring the best of beauty to the largest number of people around the world.
L'Oréal Luxe
This division is home to the company's high-end and designer brands, such as Lancôme, Yves Saint Laurent, Giorgio Armani Beauty, and Kiehl's. These products are typically sold in more selective places like department stores, specialty beauty shops, and directly from the brands' own websites. This segment is focused on premium skincare, fragrances, and makeup, offering a more luxurious experience. It has become the world's leader in the luxury beauty market.
Dermatological Beauty
Previously known as Active Cosmetics, this division provides skincare products that are often recommended by healthcare professionals like dermatologists. It includes brands such as La Roche-Posay, CeraVe, and Vichy, which you would typically find in pharmacies and drugstores. This part of the company focuses on creating highly effective and safe solutions for various skin concerns, from acne to aging. It's a fast-growing segment as more people seek out science-backed skincare.
Professional Products
This is the original heart of L'Oréal's business, serving hair salons and professional stylists directly. It includes brands like Kérastase, Redken, and L'Oréal Professionnel, which are used by hairdressers to provide services to their clients. These products are known for their high-performance formulas and are a key way the company builds strong relationships within the professional beauty industry. This division helps set hair trends and provides education to stylists around the world.
What management is betting on now
L'Oréal is heavily focused on what it calls "Beauty Tech," using technology like artificial intelligence to create more personalized products and experiences for customers. The company is also pushing to grow in emerging markets (countries with rapidly growing economies) by adapting its global brands to fit local beauty needs. Another key priority is sustainability, with goals to reduce the company's environmental impact through its "L'Oréal for the Future" program. Finally, L'Oréal continues to acquire new brands to enter fast-growing areas, especially in the medical and luxury skincare spaces.
Price history
How the share price has moved
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Is it cheap or expensive?
Fair value $73.11 vs current price $86.25
Wall Street consensus is the average analyst price target: $103.07 (41.0% higher than our fair-value estimate).
Our most-likely fair value is $73.11 a share — about 15.2% below today's price of $86.25, so the stock currently looks expensive (overvalued).
Is it drowning in debt?
Watch
Net debt $14.6B. Interest coverage 23.7x.
Net debt
$14.55B
Interest coverage
23.72x
L'Oréal S.A.'s profit covers its interest bill about 23.7 times over. which is stronger than every peer shown here.
Watch
Worse cushion
Baseline
Better cushion
LRLCY
BASELINE
L'Oréal S.A.
Total debt $19.20B Interest coverage 23.72x This is the baseline the peer rows are being compared against.
Total debt $9.25B Interest coverage 5.02x -79% vs LRLCY Carries about 4.7x less debt cushion than LRLCY.
Total debt $35.02B Interest coverage 22.52x -5% vs LRLCY Has roughly the same debt cushion as LRLCY.
Total debt $36.90B Interest coverage 9.22x -61% vs LRLCY Carries about 2.6x less debt cushion than LRLCY.
Total debt $3.30B Interest coverage 1.53x -94% vs LRLCY Carries about 15.5x less debt cushion than LRLCY.
Total debt $42.69B Interest coverage 15.35x -35% vs LRLCY Carries about 1.5x less debt cushion than LRLCY.
What you should know
The case for and against LRLCY
3 Rewards
1 Risk
Rewards
-
Revenue grew 1.3% last year.
-
Returns 19.4% on equity, ahead of 50% of its peers.
-
Free cash flow was positive in 4/10 years.
Risks
-
Insider ownership is only 0.0% (peer median: 0.1%).
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
31.94x
Forward P/E
24.53x
P/B
5.84x
P/S
5.06x
EV/EBITDA
23.41x
PEG ratio
2.29x
Profitability
How much profit each dollar creates
Gross margin
74.4%
Operating margin
21.3%
Net margin
13.9%
ROE
19.4%
ROA
9.5%
Health
Liquidity and balance-sheet strength
Debt / equity
0.49x
Current ratio
0.97x
Quick ratio
0.58x
Total debt
$19.20B
Total cash
$4.65B
Growth
How the business has been compounding
Revenue TTM
$52.11B
Revenue 5Y CAGR
4.8%
EPS TTM
2.70
EPS 5Y CAGR
2.5%
Cash flow
How much cash the business throws off
Operating CF TTM
$9.95B
Free CF TTM
$8.23B
FCF margin
15.8%
Dividend
Shareholder payout
Yield
1.9%
Payout ratio
61.1%
Last ex-div date
2026-04-28