The cosmetics industry makes consumer beauty products such as makeup, lotions, shampoos, perfumes, hair colors, and accessories. Companies in this group include Revlon Inc., Inter Parfums Inc., and South Korea-based Amorepacific Corp. Cosmetics stocks can be found in both the consumer staples and consumer discretionary sectors, with the former including consumer staples companies that also sell cosmetics and the latter including dedicated high-end cosmetics companies.
Over the last year, the S&P 500 Consumer Staples Sector Index has provided investors with a total return of 8.1%, while the S&P 500 Consumer Discretionary Sector Index has returned -12.3% over the past 12 months. By comparison, the Russell 1000 has returned -3.4%. Note that these sectors are not benchmarks for the cosmetics industry, but they can be used to get an idea of cosmetics stocks’ performance. Both sectors include a much wider array of stocks than just cosmetics names. These market performance numbers and the statistics in the tables below are as of June 1, 2022.
Here are the top 3 cosmetics stocks with the best value, fastest growth, and the best performance.
Best Value Cosmetics Stocks
These are the cosmetics stocks with the lowest 12-month trailing price-to-earnings (P/E) ratio. Because profits can be returned to shareholders in the form of dividends and buybacks, a low P/E ratio shows you’re paying less for each dollar of profit generated.
| Best Value Cosmetics Stocks | |||
|---|---|---|---|
| Price ($) | Market Cap ($B) | 12-Month Trailing P/E Ratio | |
| Ulta Beauty Inc. (ULTA) | 407.32 | 21.1 | 20.2 |
| Kao Corp. (KAOOY) | 8.17 | 19.4 | 21.2 |
| The Estée Lauder Companies Inc. (EL) | 250.42 | 89.5 | 27.4 |
Source: YCharts
- Ulta Beauty Inc.: Ulta Beauty operates a chain of beauty stores throughout the U.S. The company sells cosmetics, skin and hair care products, fragrances, and salon services. It is the one exception in our list in that it is considered part of the consumer discretionary sector rather than the consumer staples sector. Ulta reported on May 26 results for Q1 FY 2022, ended April 30. Net income surged by 43.9% on strong revenue growth year-over-year (YOY). The company attributed sales growth to the impact of fewer COVID-19 restrictions compared with the prior-year quarter.
- Kao Corp.: Kao is a Japan-based manufacturer of household and chemical products. In addition to cosmetics, the company also sells laundry and cleaning products, fatty chemicals, and edible oils.
- The Estée Lauder Companies Inc.: Estée Lauder manufactures and markets a wide range of skin care, makeup, fragrance, and hair care products. On May 3, the company announced results for Q3 FY 2022, ended March 31. Net earnings climbed by 25.1% YOY as net sales grew by 9.9%. The company saw strong growth in the Americas, Europe, the Middle East, and Africa.
These are the top cosmetics stocks as ranked by a growth model that scores companies based on a 50/50 weighting of their most recent quarterly YOY percentage revenue growth and their most recent quarterly YOY earnings-per-share (EPS) growth. Both sales and earnings are critical factors in the success of a company. Therefore ranking companies by only one growth metric makes a ranking susceptible to the accounting anomalies of that quarter (such as changes in tax law or restructuring costs) that may make one or the other figure unrepresentative of the business in general.
| Fastest Growing Cosmetics Stocks | ||||
|---|---|---|---|---|
| Price ($) | Market Cap ($B) | EPS Growth (%) | Revenue Growth (%) | |
| Olaplex Holdings Inc. (OLPX) | 15.66 | 10.2 | 36.5 | 57.6 |
| Ulta Beauty Inc. (ULTA) | 407.32 | 21.1 | 53.7 | 21.0 |
| The Estée Lauder Companies Inc. (EL) | 250.42 | 89.5 | 23.4 | 9.9 |
Source: YCharts
- Olaplex Holdings Inc.: Olaplex is a beauty company providing premium hair-care products. The company sells its products to salons, individual consumers, and retailers. Olaplex reported Q1 2022 earnings on May 11. Net income increased by 36.1% YOY on strong net sales growth, driven by solid gains across the company’s Professional, Specialty Retail, and Direct-To-Consumer business lines.
- Ulta Beauty Inc.: See company description above.
- The Estée Lauder Companies Inc.: See company description above.
These are the cosmetic stocks that had the best returns or smallest declines in total return over the past 12 months out of the companies we looked at.
| Cosmetics Stocks with the Best Performance | |||
|---|---|---|---|
| Price ($) | Market Cap ($B) | 12-Month Trailing Total Return (%) | |
| Ulta Beauty Inc. (ULTA) | 407.32 | 21.1 | 18.7 |
| e.l.f. Beauty Inc. (ELF) | 26.32 | 1.4 | -4.5 |
| Beiersdorf AG (BDRFY) | 20.28 | 23.0 | -13.5 |
| Russell 1000 | N/A | N/A | -3.4 |
| S&P 500 Consumer Staples Sector Index | N/A | N/A | 8.1 |
| S&P 500 Consumer Discretionary Sector Index | N/A | N/A | -12.3 |
Source: YCharts
- Ulta Beauty Inc.: See company description above.
- e.l.f. Beauty Inc.: e.l.f. Beauty provides mainly low-priced cosmetics products for the eyes, lips, and face. It offers eyeliners, lipsticks, powder, skin care products, and more. On April 20, e.l.f. announced that Jennie Laar would join the company as senior vice president and chief commercial officer on May 16. Laar succeeds Rich Baruch in the position. Laar was most recently senior vice president, global wholesale for Forma Brands LLC.
- Beiersdorf AG.: Beiersdorf AG is a German-based beauty company that develops, manufactures, and markets skin and personal care products. Its product portfolio includes brands including Nivea, Eucerin, La Prairie, Labello, and Hansaplast.
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