Estee Lauder downgraded to "neutral" - update

08/22/07 - Credit Suisse

NEW YORK, August 22 (newratings.com) - Analysts at Credit Suisse downgrade Estee Lauder Companies Inc (EL) from "outperform" to "neutral," while reducing their estimates for the company. The target price has been reduced from $53 to $44.

In a research note published this morning, the analysts mention that Estee Lauder’s share price has declined by 4% since the company reported its 4Q07 results, as compared to a gain of 2.9% in the S&P 500 index. The decline was primarily due to Estee Lauder’s cautious guidance for 1H08 on account of the company's decision to increase the spending in the faster-growing international markets and weakness in the department store channel of North America, the analysts say. The EPS estimate for FY08 has been reduced from $2.42 to $2.27.