We recently compiled a list of the 10 Large-Cap Stocks Insiders Are Buying Recently. In this article, we are going to take a look at where The Estée Lauder Companies Inc. (NYSE:EL) stands against the other large-cap stocks.
Investors should closely monitor insider trading activity as it can provide valuable insights into a company’s future prospects. Insiders, such as executives and directors, possess intimate knowledge of the company’s operations and strategic direction. When these individuals invest their own capital in company stock, it often signals strong confidence in the company’s future performance.
While not an infallible indicator, significant insider buying activity can suggest that the company may be undervalued or poised for growth. Conversely, while insider selling can have various motivations, it can sometimes signal concerns about the company’s future.
It’s crucial to remember that insider trading activity should be analyzed within the broader context of the company’s fundamentals, industry trends, and overall market conditions. A stock seeing heavy insider buying doesn’t always mean it will go up sharply in the future. Therefore, investors should carefully consider the underlying reasons for insider transactions and conduct thorough due diligence before making investment decisions based on this information alone. By carefully analyzing insider trading activity alongside other relevant factors, investors can gain valuable insights into a company’s prospects and make more informed investment decisions.
To come up with the 10 names, we only considered stocks with a market capitalization of more than $10 billion. We first used Insider Monkey’s insider trading stock screener and looked for stocks with at least two insiders buying over the last six months.
With each stock we note the number of recent insider purchases and the company’s current market capitalization. But why is it important to follow insider activity? Our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds, focusing on insider trading and stock picks from hedge fund investor newsletters and conferences. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
A close-up of a makeup artist carefully applying Makeup Products to an clients face.
The Estée Lauder Companies Inc. (NYSE:EL)
Number of Recent Insider Purchases: 11
Market Cap: $29.716 billion
World-wide known beauty products company The Estée Lauder Companies Inc. has been struggling over the recent year due to the troubles in its operation in China. The company known for brands like Estée Lauder, Clinique, MAC, La Mer, and Aveda attributed the drop in Asia sales to China’s economic sales.
In its report for the first quarter of fiscal 2025, the company disclosed net sales of $3.36 billion, a decrease of 4% compared to the prior year. Furthermore, Estée Lauder reported a net loss of $156 million, compared with net earnings of $31 million in the prior year, primarily due to expenses related to talcum litigation settlement agreements. Diluted net loss per common share was $.43, compared with net earnings per common share of $.09 reported in the prior year.
CNBC’s Mad Money host Jim Cramer recently said that this is “one of the worst stocks that I’ve ever seen.” However, Cramer also stressed that it’s been a “terrible” time for the cosmetics sector.
Over the last 12 months, the Estée Lauder Companies’ shares lost 38.34%, hitting a price of $83.56 per share.
Overall EL ranks 9th on our list of the large-cap stocks insiders are buying recently. While we acknowledge the potential of EL as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than EL but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
