Estee Lauder Downgraded On Risks To Growth

Estee Lauder Cos. was downgraded Wednesday to neutral from buy at UBS on concerns that the beauty company's growth prospects are at risk. Estee Lauder's price target was cut to $84 from $93. UBS analysts believe Estee Lauer's fiscal year 2017 currency-neutral growth guidance for a 6% to 7% sales increase is in danger after news of weakness at retailers like Macy's Inc. . And lower prices in China could hinder price benefits for the second half of 2017. UBS Evidence Lab analysis also shows Estee Lauder brands are holding share, but not necessarily gaining it. Estee Lauder brands include Aveda, Clinique and Mac. "Given these concerns (plus negative FX and likely near-term dilution from Estee Lauder's Too Faced acquisition that closed in late-December), we fear Estee Lauder may miss its fiscal-year 2017 top-line growth guidance...," analysts wrote. Estee Lauder shares are down 0.3% in Wednesday trading, and down more than 7% for the last year. The S&P 500 index is up 18.1% for the past 12 months.