(BFM Stock Exchange) – The cosmetics group intends to amplify its growth in the second part of the year. According to HSBC, the group has the means. But the market may have already fully integrated this acceleration.
L’Oréal was one of the rare sources of satisfaction of the CAC 40 in the recent season of results.
The group of cosmetics and beauty products saw its title win 4% during the session which followed the publication of its accounts of the first half. Only five residents of the index did better (Legrand, Danone, Essilorluxottica, Société Générale, and Carrefour).
Since the beginning of the year, L’Oréal has seen its action increase by 14.7%, twice as much as the CAC 40. The group led by Nicolas Hieronimus has made, in passing, much better than the other “Kohl” in Place de Paris, that is to say Kering (-10.6%), Hermès (-10.6%) and LVMH (-25%).
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By excluding “phasing” effects, linked to the deployment of new IT systems, L’Oréal displayed an acceleration of its growth in the second quarter, with an increase in its revenues of 3.7% in comparable data after 2.6% over the first three months of the year.
Crucial point: the director general, Nicolas Hieronimus, had confirmed, during the conference calling, the forecast of the group of a growth of the beauty of 4% in 2025. Knowing that L’Oréal tends to outperform this market, this means that the group intends to raise the cadence on the second semester 2025, the first six months of the year having resulted in an increase in 3% in -data data.
A “beauty stimulus” to accelerate growth
Can the Oréal actually increase the pace on the second half of 2025? In a note published this Friday, August 15, HSBC responds in the affirmative. The Sino-British bank tables on a growth of 5% in comparable data on the second part of 2025.
“L’Oréal should benefit from a gradual improvement in the final markets, mainly thanks to the end of a particularly difficult period for the ‘cluster’ (expenses on the domestic market as well as abroad, editor’s note)”, explains HSBC. The group will also benefit from a more lenient comparison base in its dermatological beauty division, which notably brings together the Cerave and La Roche Posay brands, adds the bank.
Another support point: launching new products. L’Oréal has set up this year a “beauty stimulus plan” this year to treat its growth, which must result in the greatest number of new features for five years (such as absolute Gloss Kérastase shampoo, Prada and Miu Miu perfumes or new Kiehl skin care).
However, the impact of these new products will rise in power in the second half, the group tabling on a contribution of three percentage points to growth, against a point in the first six months of 2025, Note HSBC.
The establishment also recalls that the geographic diversity of the company as well as its size and its agility allow it to quickly orient its efforts towards the regions and/or the categories of products which display the strongest growth.
“Consequently, we believe that during the year 2025, the company will again be able to modest its final markets modestly”, judges HSBC.
Already high multiple
Problem however: this improvement in the activity of the company is already integrated into the courses. At least that’s what the bank thinks.
“If the probability of an acceleration towards a growth of 5% should support the action, we believe that this is already largely taken into account in the current course, which is negotiated more than 30 times the benefits expected for 2025, and we therefore estimate that the potential for rising the title is limited”, underlines HSBC, which confirms its advice to “keep” on action.
At the end of July, UBS drawn up a similar otherwise identical observation. The Swiss bank had appreciated the improvement of the group’s dynamics in the second quarter, which turns out to be “auspicious for the second half”.
“L’Oréal seems to be well placed to take advantage of the continuous improvement of market growth thanks to its ‘Beauty stimulus plan’ (that is to say a significant increase in the number of new products), which should result in gains in substantial market share and more harmonious alignment prospects between the levels of ‘Sell-in’ (sales of a producer to a distributor, editor’s note) and ‘SELL-OUT’ (Sales to the final consumer, Editor’s note) in the second half of the half, “developed the Swiss establishment.
Bank of America is optimistic
But, again, UBS considered that this acceleration in the second half was “already largely taken into account” by the market. According to the Swiss Bank, consensus already incorporates 5.5% growth in the second half.
“Ultimately, in the absence of a clear revision of the results of results (…) and a revival of confidence in the ability of the Oréal to constantly achieve growth greater than 6% in the medium term, we believe that a significant re -appreation of the multiple scholarship holders is unlikely,” concluded the Swiss Bank.
Conversely, Bank of America, buying on the title, is more optimistic. The American establishment expects the acceleration of growth in the second half, with an improvement in the domestic Chinese market, an increased contribution from new innovative products and the alignment between the “Sell-in” and the “Sell-out” in dermatological beauty, improves “the feeling of market” vis-à-vis the title.
In other words, the American bank thinks that showing a gradual improvement in growth will be enough to strengthen the confidence of investors and therefore to advance action. This is also the opinion of Royal Bank of Canada who reiterated his opinion to “outperformance” on the title on July 30.
Julien Marion – © 2025 BFM Bourse
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