At a forward P/E of 5.6x, Coty screens as deeply discounted, but four consecutive earnings misses, declining revenue, business quality below the minimum threshold, and a hard death-cross signal in place indicate the discount reflects genuine fundamental stress rather than a recoverable opportunity.
Thesis pillars
- Fcf Positive Despite Accounting Loss→Stable
- Deep Value Discount Risk Trap→Stable
- Persistent Earnings Miss Streak↑Improving
- +1 more pillar — see the Why tab for full reasoning
Pillars as of Jul 3, 2026, based on the 10-K filed Aug 20, 2026
Coty Inc. (COTY) Stock Analysis
Consumer Defensive · Household & Personal Products
Sell if holding. Engine safety override at $3.36: a dimension score below its floor triggers a hard block regardless of the otherwise-positive setup — overall score 5.2/10. Specifically: Below-average business quality.
Coty is a global beauty company selling fragrance, color cosmetics, and skin and body care in approximately 122 countries and territories, split between Prestige and Consumer Beauty segments. Revenue comes from owned and licensed brands sold through department stores,... Read more
Sell if holding. Engine safety override at $3.36: a dimension score below its floor triggers a hard block regardless of the otherwise-positive setup — overall score 5.2/10. Specifically: Below-average business quality. Chart setup: No clear chart pattern; technical signals are mixed. Score 5.2/10, moderate confidence.
Passes 4/7 gates (positive momentum, clean insider activity, semi cycle peak clear, materials cycle peak clear). Fails on favorable risk/reward ratio and earnings proximity 6d<=7d. Suitability: aggressive.
About Coty Inc.
About Coty Inc.
Coty Inc. sells fragrance, color cosmetics, and skin and body care products under a portfolio of owned and licensed brands — including Gucci, Burberry, Calvin Klein, and CoverGirl — across roughly 123 countries and territories, with about 60% of fiscal 2025 net revenues from prestige fragrance. Walmart and A.S. Watson, its top two retailers, each accounted for around 4% of total net revenues, and the company employed about 11,636 people across 36 countries as of June 30, 2025.
The company earns revenue primarily from wholesale sales of owned and licensed beauty brands: 48% of fiscal 2025 net revenues came from owned or perpetually licensed brands and 37% from products under exclusive license agreements averaging 24 years in length. Distribution runs through a multi-channel network — hypermarkets, drugstores, and mid-tier department stores for mass brands, and perfumeries, department stores, and direct-to-consumer e-commerce for prestige lines — supplemented by third-party distributors in some markets. Coty manufactures about 81% of its products internally, primarily in the United States, Brazil, and Europe, sourcing the remaining 19% from third-party manufacturers; principal raw materials are essential oils, alcohols, and specialty chemicals, with essential oils generally sourced from fragrance houses. Innovation runs through in-house research centers for fragrance in Switzerland, skincare in Monaco, body care in Brazil, and cosmetics in the U.S., feeding new launches timed around the winter-holiday-driven second fiscal quarter.
Show full overview
Coty's revenue is structurally tied to a small number of licensed luxury names: some 91% of prestige-fragrance revenue in fiscal 2025 came from just seven brands, a group that includes licensed names such as Gucci and Burberry, and none of those seven licenses comes up for non-automatic renewal before 2028. Because license agreements impose minimum-sales and royalty obligations that Coty has breached in the past, losing or failing to renew a license within that group — rather than any single retailer relationship — is the concentration the 10-K flags as most consequential. Separately, certain retailers already account for over 10% of net revenues in specific geographies, including the U.S., a dependence the filing says is deepening as retail consolidation continues.
See also: Consumer Defensive · Household & Personal Products
From Coty Inc.'s most recent 10-K filing, extracted October 18, 2026.
Recent developments
updated 2026-10-29Recent Developments — Coty Inc.
Latest news
- NEWS Top 3 Risk Off Stocks That May Implode In October — benzinga Oct 28, 2026 negative
- NEWS Coty And Brandlight Announce Strategic Partnership To Unleash Potential Of Brand Discovery And Visibility Across AI Assi — benzinga Oct 27, 2026 positive
- NEWS L'Oréal Q3 Sales €11.56 Billion Vs €11.23 Billion Est.; Q3 E-Commerce Up Around +17%; Nicolas Hieronimus, CEO of L'Oréal — benzinga Oct 22, 2026 neutral
- NEWS Coty Meets Water Withdrawal Target, Cuts Virgin Plastic Use 53% Toward 60% 2030 Goal, Provides AI Training To More Than — benzinga Oct 21, 2026 positive
- NEWS Citigroup Maintains Neutral on Coty, Raises Price Target to $3 — benzinga Oct 14, 2026 positive
Generated 2026-10-29T11:14:31Z.
Upcoming dated catalysts
Thesis
Key Metrics
Quality Signals
Options Flow
Concentration Risks(10-K Item 1A)
- HIGHProductPrestige segment66%10-K Item 1: 'approximately 66% of our fiscal 2026 net revenues were attributable to our Prestige segment, of which approximately 85% was from our top seven Prestige brands'
- MEDIUMSupplierexclusive license agreements for brands37%10-K Item 1: 'Products representing 37% of our fiscal 2026 sales are under exclusive license agreements granted to us for use on a worldwide and/or regional basis'
Material Events(8-K, last 90d)
- 2026-08-20Item 5.02MEDIUMBoard approved planned CFO succession on Aug 17, 2026: Soraya Benchikh (ex-BAT CFO) succeeds Laurent Mercier effective Sept 1, 2026. Separation not due to any disagreement with the company.SEC filing →
- 2026-09-11Item 5.02LOWFormer CFO Laurent Mercier became Strategic CEO Advisor through June 30, 2027 under a Transition Agreement, keeping his EUR 825,000 base salary; released from active duties from Nov 1, 2026.SEC filing →
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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Rating Breakdown
4 floor-breakers
Technicals below the gate floor. Component breakdown shows what dragged the score down.static
Unprofitable operations — net margin -10.4%. Quality floor flags this regardless of sector context.static
Ranks in the bottom of its industry peers on the composite signal. Better names in the same sector exist.static
No near-term catalyst priced in. Thesis progression will come from fundamentals grinding, not event reaction.static
Price Targets
Position Sizing
Risk Alerts
Earnings
Verdict History
Frequently Asked Questions
Sell if holding. Engine safety override at $3.36: a dimension score below its floor triggers a hard block regardless of the otherwise-positive setup — overall score 5.2/10. Specifically: Below-average business quality. Chart setup: No clear chart pattern; technical signals are mixed. Prior stop was $3.12. Score 5.2/10, moderate confidence.
Analyst target $2.35 reached (−30.1% from $3.36); no take-profit level is published. Prior stop was $3.12. Stop-loss: $3.12.
Concentration risk — Product: Prestige segment (66.0%); Target reached (-30.1% upside); Quality below floor (3.3 < 4.0).
Coty Inc. trades at a P/E of N/A (forward 13.7). TrendMatrix value score: 7.7/10. Verdict: Sell.
21 analysts cover COTY with a consensus score of 2.7/5. Average price target: $3.
What does Coty Inc. do?Coty is a global beauty company selling fragrance, color cosmetics, and skin and body care in approximately 122...
Coty is a global beauty company selling fragrance, color cosmetics, and skin and body care in approximately 122 countries and territories, split between Prestige and Consumer Beauty segments. Revenue comes from owned and licensed brands sold through department stores, perfumeries, mass retail, e-commerce and duty-free, with Prestige about 66% of fiscal 2026 net revenues. Long-term licenses such as Gucci, Burberry and Hugo Boss underpin Prestige.