The Estee Lauder (MEX:EL) Altman Z-Score

: 4.67 (As of Today)

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Good Sign:

Altman Z-score of 4.61 is strong.

The Estee Lauder has a Altman Z-Score of 4.67, indicating it is in Safe Zones. This implies the Altman Z-Score is strong.

The zones of discrimination were as such:

When Altman Z-Score <= 1.8, it is in Distress Zones.
When Altman Z-Score >= 3, it is in Safe Zones.
When Altman Z-Score is between 1.8 and 3, it is in Grey Zones.

The historical rank and industry rank for The Estee Lauder's Altman Z-Score or its related term are showing as below:

MEX:EL' s Altman Z-Score Range Over the Past 10 Years
Min: 2.31 Med: 5.97 Max: 8.2
Current: 4.61

During the past 13 years, The Estee Lauder's highest Altman Z-Score was 8.20. The lowest was 2.31. And the median was 5.97.

The Estee Lauder Altman Z-Score Historical Data

The historical data trend for The Estee Lauder's Altman Z-Score can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

The Estee Lauder Annual Data

Trend

Jun13

Jun14

Jun15

Jun16

Jun17

Jun18

Jun19

Jun20

Jun21

Jun22

Altman Z-Score

6.92

7.58

5.03

6.88

6.25

The Estee Lauder Quarterly Data
	Jun18	Sep18	Dec18	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23
Altman Z-Score																6.74	6.25	5.94	6.10	5.31

Competitive Comparison

For the Household & Personal Products subindustry, The Estee Lauder's Altman Z-Score, along with its competitors' market caps and Altman Z-Score data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Annual Data Quarterly Data

The Estee Lauder Altman Z-Score Distribution

For the Consumer Packaged Goods industry and Consumer Defensive sector, The Estee Lauder's Altman Z-Score distribution charts can be found below:

* The bar in red indicates where The Estee Lauder's Altman Z-Score falls in comparison to its industry or sector. The grey bar indicates the Altman Z-Score's extreme value range as defined by GuruFocus.

The Estee Lauder Altman Z-Score Calculation

Altman Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

The Estee Lauder's Altman Z-Score for today is calculated with this formula:

1.2

1.4

3.3

0.6

1.0

1.2

0.1562

1.4

0.6278

3.3

0.0805

0.6

4.3025

1.0

0.7532

4.67

Trailing Twelve Months (TTM) ended in Mar. 2023:
Total Assets was MXN409,438 Mil.
Total Current Assets was MXN202,727 Mil.
Total Current Liabilities was MXN138,793 Mil.
Retained Earnings was MXN257,055 Mil.
Pre-Tax Income was 5047 + 10371.872 + 12732.795 + 965.664 = MXN29,117 Mil.
Interest Expense was -1045.45 + -1013.792 + -925.29 + -844.956 = MXN-3,829 Mil.
Revenue was 67611.775 + 90071.52 + 79051.95 + 71640.198 = MXN308,375 Mil.
Market Cap (Today) was MXN1,242,320 Mil.
Total Liabilities was MXN288,742 Mil.

* Note that for stock reported semi-annually or annually, GuruFocus uses latest annual data as the TTM data.

X1	=	Working Capital	/	Total Assets
	=	(Total Current Assets - Total Current Liabilities)	/	Total Assets
	=	(202727.175 - 138792.5)	/	409437.875
	=	0.1562

X2	=	Retained Earnings	/	Total Assets
	=	257054.525	/	409437.875
	=	0.6278

X3	=	Earnings Before Interest and Taxes	/	Total Assets
	=	(Pre-Tax Income - Interest Expense)	/	Total Assets
	=	(29117.331 - -3829.488)	/	409437.875
	=	0.0805

X4	=	Market Value Equity	/	Book Value of Total Liabilities
	=	Market Cap	/	Total Liabilities
	=	1242320.394	/	288742.475
	=	4.3025

X5	=	Revenue	/	Total Assets
	=	308375.443	/	409437.875
	=	0.7532

The zones of discrimination were as such:

Distress Zones - 1.81 < Grey Zones < 2.99 - Safe Zones

The Estee Lauder has a Altman Z-Score of 4.67 indicating it is in Safe Zones.

Study by Altman found that companies that are in Distress Zone have more than 80% of chances of bankruptcy in two years.

The Estee Lauder (MEX:EL) Altman Z-Score Explanation

X1: The Working Capital/Total Assets (WC/TA) ratio is a measure of the net liquid assets of the firm relative to the total capitalization. Working capital is defined as the difference between current assets and current liabilities. Ordinarily, a firm experiencing consistent operating losses will have shrinking current assets in relation to total assets. Altman found this one proved to be the most valuable liquidity ratio comparing with the current ratio and the quick ratio. This is however the least significant of the five factors.

X2: Retained Earnings/Total Assets: the RE/TA ratio measures the leverage of a firm. Retained earnings is the account which reports the total amount of reinvested earnings and/or losses of a firm over its entire life. Those firms with high RE, relative to TA, have financed their assets through retention of profits and have not utilized as much debt.

X3, Earnings Before Interest and Taxes/Total Assets (EBIT/TA): This ratio is a measure of the true productivity of the firm's assets, independent of any tax or leverage factors. Since a firm's ultimate existence is based on the earning power of its assets, this ratio appears to be particularly appropriate for studies dealing with corporate failure. This ratio continually outperforms other profitability measures, including cash flow.

X4, Market Value of Equity/Book Value of Total Liabilities (MVE/TL): The measure shows how much the firm's assets can decline in value (measured by market value of equity plus debt) before the liabilities exceed the assets and the firm becomes insolvent.

X5, Revenue/Total Assets (S/TA): The capital-turnover ratio is a standard financial ratio illustrating the sales generating ability of the firm's assets.

Be Aware

Altman Z-Score does not apply to financial companies.

The Estee Lauder Altman Z-Score Related Terms

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The Estee Lauder (MEX:EL) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Defensive » Consumer Packaged Goods » The Estee Lauder Companies Inc (MEX:EL) » Definitions » Altman Z-Score

Comparable Companies

Traded in Other Exchanges

EL:USA ELAA:Germany ELCI34:Brazil ESLA:Austria

Address

767 Fifth Avenue, New York, NY, USA, 10153

Website

https://www.elcompanies.com

Estee Lauder is the world leader in the global prestige beauty market, participating across skincare (56% of fiscal 2022 sales), makeup (26%), fragrance (14%), and haircare (4%) categories, with popular brands such as Estee Lauder, Clinique, MAC, La Mer, Jo Malone, Aveda, Bobbi Brown, Too Faced, Origins, Dr. Jart+, and The Ordinary. The firm operates in 150 countries, with 26% of fiscal 2022 revenue stemming from the Americas, 43% from Europe, the Middle East and Africa, and 31% from Asia-Pacific. The company sells its products through department stores, travel retail, multibrand specialty beauty stores, brand-dedicated freestanding stores, e-commerce, salons/spas, and perfumeries.