Estee Lauder Is Poised to Ride Beauty Premiumization Tailwinds, Though China Headwinds May Persist

As a leading provider of premium beauty products, Estee Lauder owns category-leading brands in skin care, cosmetics, and fragrances underpinning its brand intangibles, in addition to retaining a preferred vendor status across brick-and-mortar and digital channels. These attributes, coupled with scale-based cost advantages, should augur a long-term competitive edge that enables the firm to deliver excess returns for more than 20 years. As such, we award Estee a wide moat rating.