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- Estee Lauder shares jumped, with traders showing optimism after the makeup company's shares fell through the end of last week.
- The company beat on revenue and earnings per share, but warned that the third quarter would see a significant coronavirus-related hit to growth.
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By the time Estee Lauder revealed the hit it would take to growth as a result of the Wuhan coronavirus, it appeared that the market had already reconciled itself to that fear.
Shares jumped as much as 6% Thursday after the makeup company posted stronger revenue and earnings-per-share numbers than the Street expected.
Revenue for the company's second fiscal quarter was $4.624 billion — analysts had expected only $3.845 billion, according to a Bloomberg survey. Adjusted earnings per share were $2.110, a beat over the $1.596 analysts predicted.
That good news came alongside confirmation from the company that it expects coronavirus-related dips in demand to eat into earnings in the third quarter. Estee Lauder projected earnings per common share, excluding certain charges, would be between $5.60 and $5.70 for the fiscal year, a reduction from the $5.85 to $5.93 band it offered last quarter. It is the second quarter running that the company has cut that metric.
Coronavirus is a fear Wall Street has been pricing into Estee Lauder stock since the outbreak began. Estee Lauder is tied for first as the most exposed US retailer to coronavirus risk, with 17% of revenue exposed, according to a January Credit Suisse note.
The stock fell around 11% since January 17, which many analysts consider to be the day the outbreak began. It's pared those losses this week, as broader market concern around coronavirus eased.
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