Estée Lauder (NYSE:EL) shares are trading lower on Thursday. The company reported first-quarter adjusted earnings per share of 14 cents, beating the street view of 9 cents. Quarterly sales of $3.36 billion (down 4%), missed the analyst consensus estimate of $3.371 billion. Segmentally, the Skin Care unit sales slumped by 7%, Makeup fell by 2%, Fragrance decreased by 1%, and Hair Care dropped by 6%.
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00:00Wow, oh my gosh, it got worse, Joel.
00:04It doesn't stop.
00:05The pain for this stock is astounding.
00:08Is this story officially over?
00:11Tell us, AB, tell us, tell us, Aaron Bry, tell us, please.
00:17It's Aaron Bry.
00:19He was a Bry.
00:20No, no, it's, you're messing with me.
00:23All right, EPS.
00:25Bry, Joel didn't get the joke.
00:27EPS came in at $0.14.
00:30That actually beat by $0.04 there.
00:33Revenue of $3.36 billion, missed by $10 million there.
00:37But then Estee Lauder came out and slashed the dividend
00:40by almost half to $0.35 a share.
00:44And then they cut its full year guidance here.
00:46So stock is getting crushed down more than 23%
00:50this morning after the guidance cut, because you had the,
00:53I mean, they did beat on EPS, then
00:55the slight miss on revenue.
00:57But you cut your guidance, you cut your dividend.
00:59The shareholders or the traders are not going to like that.
01:02See the stock go down more than $20 this morning,
01:05like I said, 23 and 1.5%.
01:08Bringing some other names in the space down with it.
01:10You're seeing Elf Beauty down about 3%.
01:12You're seeing Ulta down about 1.5%.
01:16So Estee Lauder, it's been kind of worse
01:17to breathe out of this basket of cosmetic stocks
01:20and continuing to move lower today.
01:23Well, Cody kicked it off.
01:25Cody kicked it off, what, in a week and a half
01:27or two weeks ago, and they disappointed.
01:29And the stock went from nine down to seven.
01:31That has put an end to my Elf Beauty long,
01:34because it was like, wow, Cody bringing it down.
01:36So I sold Elf that day.
01:38Elf still hanging out here.
01:39It's still holding in support.
01:40Elf wants to go higher,
01:42but the peers keep knocking it back down.
01:45And again, the same thing here today.
01:47EL down 23%, man.
01:51These are big moves.
01:53And this is now a new multi-year low.
01:56I don't know how far you got to go back.
01:57I'm going back to 2017,
01:59and that is not far enough to find
02:01anything on the chart here at all.
02:03You got to go back like 20.
02:04We're going back to like 10-year lows here for EL.
02:08Is this the end of makeup?
02:11Oh boy, oh boy.
02:13Well, at least at Estee Lauder it is.
02:16So this is what I'm going to do on this one.
02:19I'm going to set up a trade,
02:20and this is not for me, not for everybody,
02:24but this is what I think is going to happen.
02:27I think possibly between 63 and 67,
02:34someone's just going to,
02:36I mean, if they're short, I'd start buying now.
02:39But between 63 and 67,
02:42someone's just going to build a boatload of a position.
02:47Just, you know, big position.
02:49And I don't care if it ever even goes back to 75 bucks.
02:54It's going to do a little,
02:55you know, the Mickey D's, you know,
02:57when you puked it out,
02:59and you could even buy it lower in the pre-market.
03:0387 standard deviations,
03:06or what did Fari used to call them?
03:08Sigma.
03:09This is like a Sigma 20.
03:12And they'll build that position,
03:15and then the sellers will dry up a little bit.
03:17Eventually the volume will come down,
03:20and you'll just run out of sellers.
03:22You know, like today it's already traded 1.2 million,
03:25and we'll probably trade, you know,
03:26eight to 10 million today.
03:28The sellers will dry up.
03:29You get like just this little weak pop,
03:32and they'll just be scaling out, scaling out, scaling out,
03:36regardless of caring about the long-term direction
03:39of the stock.
03:40So that is my setup for Estee Slaughter over the next week.
03:45We'll see how it plays out.
03:47I mean, this whole sector,
03:49it's not just Estee Slaughter now here.
03:52I mean, you got all 10 Warren Buffets down and dirty
03:54in that one, and that has gone nowhere,
03:56and it's off the high significantly here.
03:58But just continuing on, we talked Cody already there,
04:01and Elf Beauty,
04:02which was the one that everybody thought
04:05was eating EL's lunch.
04:06Now it's lunch is getting just eaten.
04:08It's the whole pie.
04:09Like I'm just questioning the entire,
04:11like there's no stock doing good in this entire sector.
04:14That's rare.
04:15You know, you look like the auto parts.
04:16Well, there's one auto parts company doing better,
04:18and it's eating the lunch of the others.
04:19I mean, we're looking at these stocks.
04:21Elf's 50% off the highs.
04:23You know, EL is like light years off its highs.
04:25Cody, forget about Cody.
04:27It's, you know, gone.
04:28You know, like it was like $30 stock at seven bucks,
04:32and you know, Alt has held up better than the others,
04:34but still all-time high, 574 to 369.
04:37It's like a 40% haircut here too.
04:40Is there any other stock, you know, that we're missing here?
04:43Like that's, you know,
04:44it seems like this whole sector is just in trouble.