Down 13% In The Past Month, L’Oreal Stock Now Looks Like A Buy

-2.29%
Downside
74.41
Market
72.71
Trefis
LRLCY: L'Oreal logo
LRLCY
L'Oreal

L’Oreal stock (OTCMKTS: LRLCY) is down 13% in the past month (21 trading days), underperforming the S&P 500 which was down more than 7% over this period. If you look at the change over the last five and ten days, too, the stock has returned -1.6% and -4.7%, failing to outperform the broader market on both occasions. L’Oreal reported Q3 ’21 sales at $9.01 billion, up from $7.93 billion in Q3 ’20, seeing a YoY growth of around 13%. Sales for the first nine months of FY ’21 stand at $26.13 billion, up from $22.67 billion for the first nine months of FY ’20. L’Oreal has benefited from the fact that hair and skin care demand has sustained its growth, while makeup and fragrance demand has risen with people stepping out more often. The company expects this demand growth to continue and reflect in its full-year 2021 earnings, due next week.

Now, is L’Oreal stock set to continue its underperformance or could we expect a rally? We believe that there is a greater than 90% chance of a rise in L’Oreal stock over the next month (21 trading days) based on our machine learning analysis of trends in the stock price over the last ten years. See our analysis on LRLCY Stock Chance of Rise. For additional details about L’Oreal’s reporting segments, see L’Oreal Revenues: How Does LRLCY Make Money?

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  2. L’Oreal Stock Poised For Bounce Back After Rough Month?
  3. After Dismal Performance Last Month, L’Oreal Stock Looks Set To Rebound
  4. L’Oreal Stock Looks Set For A Rally On The Back Of Strong Earnings Growth
  5. Forecast Of The Day: L’Oreal Makeup Revenues
  6. What’s Next For L’Oreal Stock After A 6% Rise Last Month?

Twenty-One Day: LRLCY -13%, vs. S&P500 -7.2%; Underperformed market

(<1% likelihood event; 100% probability of rise over next 21 days)

  • LRLCY stock dropped 13% the last twenty-one trading days (one month), compared to a broader market (S&P500) drop of 7.2%
  • A change of -13% or more over twenty-one trading days is a <1% likelihood event, which has occurred 13 times out of 2515 in the last ten years
  • Of these 13 instances, the stock has seen a positive movement over the next twenty-one trading days on 13 occasions
  • This points to a 100% probability for the stock rising over the next twenty-one trading days

Ten Day: LRLCY -4.7%, vs. S&P500 -4.9%; Narrowly Outperformed market

(6% likelihood event; 66% probability of rise over next 10 days)

  • LRLCY stock dropped 4.7% over the last ten trading days (two weeks), compared to a broader market (S&P500) drop of 4.9%
  • A change of -4.7% or more over ten trading days is a 6% likelihood event, which has occurred 142 times out of 2517 in the last ten years
  • Of these 142 instances, the stock has seen a positive movement over the next ten trading days on 94 occasions
  • This points to a 66% probability for the stock rising over the next ten trading days

Five Day: LRLCY -1.6%, vs. S&P500 0.5%; Underperformed market

(16% likelihood event; 63% probability of rise over next five days)

  • LRLCY stock shed 1.6% over a five-day trading period ending 1/28/2022, compared to the broader market (S&P500) marginal rise of 0.5%
  • A change of 1.6% or more over five trading days (one week) is a 16% likelihood event, which has occurred 413 times out of 2517 in the last ten years
  • Of these 413 instances, the stock has seen a positive movement over the next five trading days on 261 occasions
  • This points to a 63% probability for the stock rising over the next five trading days

What if you’re looking for a more balanced portfolio instead? Here’s a high-quality portfolio that’s beaten the market consistently since the end of 2016.

 Returns Jan 2022
MTD [1]
2022
YTD [1]
2017-22
Total [2]
 LRLCY Return -14% -14% 126%
 S&P 500 Return -6% -6% 100%
 Trefis MS Portfolio Return -12% -11% 248%

[1] Month-to-date and year-to-date as of 1/31/2022
[2] Cumulative total returns since the end of 2016

 

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