Consumer Staples

Report by Real Street Retail Research

North American sales trends are increasingly disconnected from the US Beauty market. As inventory mounts in TJX & Costco and once forbidden discounts ramp up on DTC sites and department stores, the prospect of a meaningful turnaround in the medium term is in question. Distribution expansion at Ulta Beauty, Ulta @ Target and Sephora @ Kohl's, has not slowed the share bleed and a new generation of prestige brands has traction in the market. The outlook for this once dominant portfolio of legacy brands in the US is murky at best as the critical Holiday '23 season approaches.

Consumer Staples

Report by Woozle Research

100% of retailers interviewed by Woozle reported that the cosmetics giant is “clearly strategically outperforming” competitors such as Estee Lauder and Beiersdorf brands, due to quicker innovation and better positioning around the natural, sustainable themes for self-care products. Woozle's latest channel checks (across US, Europe and Australia) suggest OR is trading ahead of consensus forecasts in 1Q23, driven by outperformance in L'Oreal Luxe and Consumer Products, partly offset by weaker than forecast Active Cosmetics sales growth. On the subject of pricing, respondents reported an average increase of 10% Y/Y for OR brands (vs. 7% increase for EL).

Consumer Discretionary

Report by JJK Research Associates

Consumer stocks are climbing the wall of worry reflecting supply chain challenges, higher distribution expense, rising prices and tough comps. Hence, there is limited visibility on the consumer sector delivering yoy F22 earnings gains. JJK highlight a select few who are well positioned for growth, including the value focused off-price retailers (TJX, Burlington, Ross) and beauty leaders (Bath & Body Works, Estee Lauder, Ulta). Upgraded growth strategies and Europe’s emerging rebound should also drive strong upside at A&F, Capri Holdings, Lululemon, PVH, Ralph Lauren and Victoria’s Secret.