Estee Lauder Stock Pops on Potential $2.8 Billion Buyout

This could be the company's biggest acquisition to date

Digital Content Manager
Nov 15, 2022 at 10:23 AM
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Estee Lauder Companies Inc (NYSE:EL) is up 2.7% to trade at $226.64 at last check, after The Wall Street Journal reported that the cosmetics concern is nearing a $2.8 billion deal to buy luxury fashion brand Tom Ford, in what could be its biggest acquisition to date.

The security has been enjoying the after effects of a bounce off its Nov. 3, two-year low of $186.47 over the last couple of weeks, and conquered overhead pressure at the 20-day moving average, which had been guiding the shares lower since late August. A new ceiling appears to be forming at the $230 level, though, and year-to-date EL remains down 38.7%.

The brokerage bunch is fiercely optimistic on Estee Lauder stock, with 14 of the 18 firms in coverage carrying a "buy" or better rating. The 12-month consensus target price of $243.17 is only a 7.3% premium to the security's current perch, however, indicating EL may still see price-target hikes.

It's also worth noting the security's Schaeffer's Volatility Scorecard (SVS) ranks at 75 out of a possible 100. This suggests options traders pricing in relatively low volatility expectations for Estee Lauder stock at the moment, and that EL tends to exceed said expectations -- a boon for buyers.  

 

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