One-glance verdict
Overvalued
$75.60 our estimate vs market $89.88
Wall Street consensus: $99.33 (31.4% higher than our fair-value estimate)
19% above our estimate, beyond the bull case
Fundamentals snapshot
L'Oréal S.A.
LRLCY · PNK · Consumer Defensive · Household & Personal Products
Current price
$89.88
52-week range
$78.82 - $95.48
Market cap
$239.37B
Balance sheet
Watch
23.72x Strong cushion
Net debt $14.61B. 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: 0.4%).
What this company does
L'Oréal S.A.
L'Oréal is a massive global beauty company that owns many famous brands you might know, from everyday makeup like Maybelline to luxury skincare like Kiehl's and dermatologist-recommended products like CeraVe. The company makes money selling a wide range of products at different prices all over the world, with its largest sales coming from skincare and makeup. This matters because having a diverse portfolio of both affordable and high-end brands helps the company's sales remain stable even if customer spending habits change.
How the company got here
L'Oréal was started in 1909 by a young French chemist named Eugène Schueller, who developed and sold a new, safer hair dye formula to Parisian hairdressers. This focus on scientific research and innovation has been central to the company ever since. Over the decades, L'Oréal grew by acquiring (buying) well-known brands like Lancôme, Garnier, Maybelline, and Redken, expanding from hair color into a wide range of beauty products. This strategy of buying successful brands and expanding globally helped it become the world's largest cosmetics company.
What it actually does
L'Oréal manufactures and sells a huge variety of beauty products for both women and men. You would recognize many of its brands from drugstores, department stores, and hair salons. The company's products include makeup, skincare, hair color, haircare, and fragrances. It owns dozens of global brands that are sold in nearly 150 countries through various channels, from mass-market retailers to luxury stores and pharmacies.
Consumer Products
This is L'Oréal's largest division, making up over a third of its sales. It focuses on making beauty products accessible to everyone, selling them in supermarkets, drugstores, and other mass-market retailers. This segment includes some of the world's most recognizable brands like L'Oréal Paris, Maybelline New York, and Garnier. The goal of this division is to offer high-quality but affordable makeup, skincare, and haircare to a wide audience.
L'Oréal Luxe
This division, which accounts for just over a third of the company's business, is all about high-end beauty. It includes prestigious brands like Lancôme, Yves Saint Laurent, and Giorgio Armani, which are typically sold in department stores and specialty beauty shops. These products are more expensive and focus on providing a premium experience through skincare, makeup, and fragrances. This part of the company often partners with famous fashion houses to create their beauty lines.
Dermatological Beauty
This is a fast-growing segment for L'Oréal, focused on skincare that is recommended by healthcare professionals. You'll find these brands, such as La Roche-Posay, CeraVe, and Vichy, mainly in pharmacies and drugstores. This division works closely with dermatologists to create products that address specific skin concerns, from acne to aging. It represents a smaller but significant part of the company's total sales.
Professional Products
This is the company's original business and the smallest of the four divisions. It sells products directly to hair salons and stylists, including brands like Redken, Kérastase, and Matrix. These are the professional-grade hair color, styling, and treatment products that your hairdresser uses. The division supports millions of stylists worldwide through education and a distribution network that includes both e-commerce (selling things online) and physical stores.
What management is betting on now
L'Oréal is focusing heavily on technology and sustainability to drive future growth. The company is investing in what it calls "Beauty Tech," using artificial intelligence and data to create more personalized products and online experiences for customers. It is also expanding its Dermatological Beauty division to meet growing consumer demand for science-backed skincare. Finally, L'Oréal has set ambitious environmental goals, aiming to make its packaging from recycled or bio-based sources and achieve carbon neutrality (balancing carbon emissions with carbon removal) at its sites.
Price history
How the share price has moved
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Is it cheap or expensive?
Fair value $75.60 vs current price $89.88
Wall Street consensus is the average analyst price target: $99.33 (31.4% higher than our fair-value estimate).
Our most-likely fair value is $75.60 a share — about 15.9% below today's price of $89.88, so the stock currently looks expensive (overvalued).
Is it drowning in debt?
Watch
Net debt $14.6B. Interest coverage 23.7x.
Net debt
$14.61B
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 $19.29B Interest coverage 23.72x This is the baseline the peer rows are being compared against.
Total debt $9.30B Interest coverage 3.20x -87% vs LRLCY Carries about 7.4x 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 $7.86B Interest coverage 15.85x -33% vs LRLCY Carries about 1.5x less debt cushion than LRLCY.
Total debt $3.42B Interest coverage 2.34x -90% vs LRLCY Carries about 10.1x less debt cushion than LRLCY.
Total debt $916.90M Interest coverage 3.22x -86% vs LRLCY Carries about 7.4x 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: 0.4%).
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)
34.05x
Forward P/E
25.54x
P/B
5.98x
P/S
5.28x
EV/EBITDA
24.35x
PEG ratio
2.65x
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
$19.29B
Total cash
$4.67B
Growth
How the business has been compounding
Revenue TTM
$52.34B
Revenue 5Y CAGR
4.8%
EPS TTM
2.64
EPS 5Y CAGR
2.5%
Cash flow
How much cash the business throws off
Operating CF TTM
$9.99B
Free CF TTM
$8.26B
FCF margin
15.8%
Dividend
Shareholder payout
Yield
1.9%
Payout ratio
60.9%
Last ex-div date
2026-04-28