Coty Inc. (NYSE: COTY)

Sector: Consumer Defensive Industry: Household & Personal Products CIK: 0001024305
Market Cap 2.76 Bn
P/B 0.78
P/E -5.08
P/S 0.48
ROIC (Qtr) 0.65
Div Yield % 0.00
Rev 1y % (Qtr) 0.52
Total Debt (Qtr) 3.26 Bn
Debt/Equity (Qtr) 0.93

About

Coty Inc., a leading beauty company with the ticker symbol COTY, operates in the vast and dynamic industry of cosmetics, fragrances, and skincare. With a rich history dating back to 1904, Coty has established a strong presence in over 126 countries, making it one of the largest beauty companies globally. Coty's main business activities are divided into two primary segments: Consumer Beauty and Prestige. The Consumer Beauty segment includes mass beauty brands such as Adidas, Burberry, and Sally Hansen, while the Prestige segment boasts high-end...

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Price action

Investment thesis

Bull case

  • Healthy cash reserves of 448M provide 6.65x coverage of short-term debt 67.40M, demonstrating strong liquidity position and minimal refinancing risk.
  • Operating cash flow of 585.60M provides exceptional 35.49x coverage of minority interest expenses 16.50M, showing strong core operations.
  • Operating cash flow of 585.60M provides strong 11.74x coverage of stock compensation 49.90M, indicating sustainable incentive practices.
  • Robust free cash flow of 390.80M exceeds capital expenditure of 194.80M by 2.01x, indicating strong organic growth funding capability.
  • Cash position of 448M provides exceptional 27.15x coverage of minority interest expenses 16.50M, indicating strong liquidity.

Bear case

  • Operating cash flow of 585.60M barely covers its investment activities of 638.50M, with a coverage ratio of 0.92, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating cash flow of 585.60M provides thin coverage of dividend payments of (13.20M) with a -44.36 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • Operating cash flow of 585.60M provides minimal -7.15x coverage of tax expenses of (81.90M), suggesting potential tax planning inefficiencies or unsustainable tax positions.
  • Operating earnings of (426.10M) show weak coverage of depreciation charges of 497M, with a -0.86 ratio indicating high capital intensity and potential reinvestment needs.
  • Free cash flow of 390.80M represents just -0.55x of debt issuance (712.10M), suggesting concerning reliance on leverage rather than internal cash generation for growth.

Segments Breakdown of Revenue (2025)

Segments Breakdown of Revenue (2025)

Peer comparison

Companies in the Household & Personal Products
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 PG PROCTER & GAMBLE Co 401.54 Bn 29.00 5.43 36.64 Bn
2 UL Unilever Plc 182.31 Bn 22.43 2.85 -
3 CL Colgate Palmolive Co 78.47 Bn 52.42 4.20 8.42 Bn
4 KMB Kimberly Clark Corp 35.97 Bn 19.97 1.96 7.30 Bn
5 EL Estee Lauder Companies Inc 34.41 Bn -193.32 2.35 9.39 Bn
6 KVUE Kenvue Inc. 34.07 Bn 23.78 2.27 8.97 Bn
7 CHD Church & Dwight Co Inc /De/ 25.66 Bn 58.49 7.25 2.20 Bn
8 CLX Clorox Co /De/ 14.46 Bn 19.15 2.14 3.22 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.61 1.51
EV to Cash from Ops. EV/CFO 11.59 11.18
EV to Debt EV to Debt 2.08 4.46
EV to EBIT EV/EBIT -15.92 22.50
EV to EBITDA EV/EBITDA 12.00 5.19
EV to Free Cash Flow [EV/FCF] EV/FCF 17.36 29.65
EV to Market Cap EV to Market Cap 2.46 -1.73
EV to Revenue EV/Rev 1.17 2.27
Price to Book Value [P/B] P/B 0.78 -46.60
Price to Earnings [P/E] P/E -5.08 15.50
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) -20.58 8.97
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 5.07
Dividend per Basic Share Div per Share (Qtr) 0.00 0.95
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 10.73
Interest Coverage Int. cover (Qtr) -2.29 2.60
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 20.46 -97.30
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 66.79 5.93
Dividend Growth (1y) % Div 1y % (Qtr) 0.00 -0.27
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -680.95 -154.67
EBITDA Growth (1y) % EBITDA 1y % (Qtr) -48.60 -119.65
EBIT Growth (1y) % EBIT 1y % (Qtr) -240.81 -149.91
EBT Growth (1y) % EBT 1y % (Qtr) -1,051.94 -226.50
EPS Growth (1y) % EPS 1y % (Qtr) 0.00 -132.37
FCF Growth (1y) % FCF 1y % (Qtr) 33.15 27.80
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) -7.09 -2.04
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.52 0.82
Cash Payout Ratio Cash Payout (Qtr) 0.02 0.19
Cash Ratio Cash Ratio (Qtr) 0.16 0.75
Current Ratio Curr Ratio (Qtr) 0.79 2.30
Debt to Equity Ratio Debt/Equity (Qtr) 0.93 1.13
Interest Cover Ratio Int Coverage (Qtr) -2.29 2.60
Times Interest Earned Times Interest Earned (Qtr) -2.29 2.60
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 1.20 -32.80
EBIT Margin % EBIT Margin % (Qtr) -7.34 -37.22
EBT Margin % EBT Margin % (Qtr) -10.54 -40.91
Gross Margin % Gross Margin % (Qtr) 63.70 50.08
Net Profit Margin % Net Margin % (Qtr) -9.40 -43.08