L'Oréal S.A.
L'Oréal S.A. Fundamental Analysis
L'Oréal S.A. (OR.PA) shows moderate financial fundamentals with a PE ratio of 31.18, profit margin of 13.91%, and ROE of 18.53%. The company generates $44.0B in annual revenue with moderate year-over-year growth of 5.60%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 73.4/100 based on profitability, valuation, growth, and balance sheet metrics. The B grade reflects solid fundamentals with room for improvement in valuation or growth.
Fundamental Health Score
We analyze OR.PA's fundamental strength across five key dimensions:
Efficiency Score
WeakOR.PA struggles to generate sufficient returns from assets.
Valuation Score
WeakOR.PA trades at a premium to fair value.
Growth Score
ModerateOR.PA shows steady but slowing expansion.
Financial Health Score
ExcellentOR.PA maintains a strong and stable balance sheet.
Profitability Score
ModerateOR.PA maintains healthy but balanced margins.
Key Financial Metrics
Is OR.PA Expensive or Cheap?
P/E Ratio
OR.PA trades at 31.18 times earnings. This suggests a premium valuation.
PEG Ratio
When adjusting for growth, OR.PA's PEG of 89.19 indicates potential overvaluation.
Price to Book
The market values L'Oréal S.A. at 5.47 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 17.25 times EBITDA. This signals the market has high growth expectations.
How Well Does OR.PA Make Money?
Net Profit Margin
For every $100 in sales, L'Oréal S.A. keeps $13.91 as profit after all expenses.
Operating Margin
Core operations generate 22.51 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $18.53 in profit for every $100 of shareholder equity.
ROA
L'Oréal S.A. generates $9.91 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
L'Oréal S.A. produces operating cash flow of $8.64B, showing steady but balanced cash generation.
Free Cash Flow
L'Oréal S.A. generates strong free cash flow of $7.15B, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $13.43 in free cash annually.
FCF Yield
OR.PA converts 3.76% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
31.18
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
89.19
vs 25 benchmark
P/B Ratio
Price to book value ratio
5.47
vs 25 benchmark
P/S Ratio
Price to sales ratio
4.33
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.34
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.44
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.19
vs 25 benchmark
ROA
Return on assets percentage
0.10
vs 25 benchmark
ROCE
Return on capital employed
0.21
vs 25 benchmark
How OR.PA Stacks Against Its Sector Peers
| Metric | OR.PA Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 31.18 | 22.37 | Worse (Expensive) |
| ROE | 18.53% | 1250.00% | Weak |
| Net Margin | 13.91% | -5215.00% (disorted) | Strong |
| Debt/Equity | 0.34 | 1.23 | Strong (Low Leverage) |
| Current Ratio | 1.44 | 2.47 | Neutral |
| ROA | 9.91% | -193095.00% (disorted) | Weak |
OR.PA outperforms its industry in 2 out of 6 key metrics, particularly excelling in Net Margin, but lagging in P/E Ratio.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews L'Oréal S.A.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
52.45%
Industry Style: Defensive, Dividend, Low Volatility
High GrowthEPS CAGR
78.97%
Industry Style: Defensive, Dividend, Low Volatility
High GrowthFCF CAGR
38.56%
Industry Style: Defensive, Dividend, Low Volatility
High Growth