navan travel stock

As the IPO market comes back to life, Navan (formerly TripActions) is targeting an April 2024 listing

• Navan, an online travel management startup, has been one of the most hotly anticipated tech IPOs.
• The company is now targeting a late April 2024 IPO, Insider has learned.
• "When we have news to share on this, we will," said a Navan spokeswoman. 

Navan, formerly known as TripActions, is now targeting a late April 2024 IPO, according to a person with direct knowledge of the matter not authorized to speak publicly. 

The online travel management startup has been one of the most hotly anticipated IPOs in recent years. The company filed confidential paperwork to go public at a $12 billion dollar valuation sometime this year, Insider reported last September. 

But Navan CEO Ariel Cohen is now eyeing a late April 2024 IPO, with the goal of further improving Navan's gross margins and other important metrics to impress Wall Street, according to the person.

"Our focus is on building the best travel and expense business in the market," said Navan spokeswoman Kelly Soderlund.  "When we have news to share on this, we will."

So far this year, there have been just 43 IPOs for U.S. venture-backed startups compared to 399 in 2021, according to Crunchbase.

Related stories

However, this month the nearly two year dormant IPO market has finally shown signs of coming to life.  Instacart could go public on the NASDAQ as soon as next month, Bloomberg reported.  Arm, the chipmaker owned by Softbank, filed for its IPO on Monday. 

Navan has been working with Goldman Sachs on IPO preparations, The Information reported in March. 

Its not clear at what price Navan would go public. The company last raised at a $9.2 billion valuation in October of 2022 in a round led by Group 11 with participation from Lightspeed Venture Partners, Coatue Management, Zeev Ventures, and Andreessen Horowitz, according to Pitchbook data.

Some shares of the company on secondary markets have been trading at a significant discount with recent sales valuing the company at just $5.7 billion, according to data from Caplight , a private market exchange. But secondary sales are not usually indicative of what price a company will be listed.

Andreessen Horowitz first invested in TripActions in 2018, when it led the company's series C funding round at a $1.1 billion valuation and general partner Ben Horowitz joined the board. 

"It's been remarkable that as consumer travel has been completely transformed, business travel hasn't changed at all so having a real solution to it just made a lot of sense and I thought they could build a great company," Horowitz told Insider last year.

Navan has raised more than $2 billion in equity and debt financing since it was founded 2015, according to Pitchbook.

Watch: While Delta's business is 'extremely robust,' the airline's marketing chief stays focused on the data

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Navan IPO: Will the Stock Begin Trading this Year?

by Craig Stephens Leave a Comment

Explore opportunities to own the company before the Navan IPO. Get access to select pre-IPO startups like OpenAI, Databricks, Anduril, and Anthropic via the Fundrise Innovation Fund .

Table of Contents

Recent Navan IPO Stock News

08/25/2023: BI: Navan is Targeting an April 2024 IPO 10/12/2022: Navan’s Platform Increases Valuation to $9.2B 09/28/2022: BI: TripActions Files Confidentially for an IPO 02/07/2023: TripActions Rebrands to Navan Older news…

What is Navan?

Navan is a travel and expense management software-as-a-service (SaaS) provider for small businesses and corporate enterprises.

The Palo Alto, California-based startup was founded in May 2015 as TripActions by Ariel Cohen and Ilan Twig, who previously cofounded and sold StreamOnce. 

The company emerged from stealth mode in early 2017 and rebranded to Navan in early 2023. 

Navan empowers employees to reserve, manage, and view their travel and expenses on an intuitive, modern, and mobile platform.

Behind the scenes, travel and expense data helps businesses run more efficiently, providing business intelligence to analyze costs and make data-driven decisions. 

Pronounced “nah-vaughn”, the company derived its name from the words “navigate” and “avant” — “the art of navigating the world with ease and grace”. 

Here’s an introductory video for Navan that shows the software in action. 

Is Navan Stock Publicly Traded Today?

No. Navan is a private company. 

Who Owns Navan?

Navan is a venture-based startup. Ownership is comprised of the founders, employees, and multiple high-profile venture capital firms. 

Prominent venture capital investors include Andreessen Horowitz, Lightspeed Ventures,  SGVC, Zeev Ventures, Vista Equity Partners, Addition, Group 11, Base Partners, and Coatue.

After the IPO, Proxima Media (Ryan Kavanaugh) and Bobby Sarnevesht will control a majority of voting power. 

What is the Navan Valuation?

The most recently confirmed Navan valuation is $9.2 billion based on an October 2022 Series G funding round.

Pre-IPO market data on the Hiive private marketplace and other sources indicate the valuation is about half that amount, near $5 billion.

When is the Navan IPO Date?

The Navan IPO date is unknown. Some speculation has indicated it is a top contender for an upcoming IPO. However, Access IPOs has not seen evidence that an IPO is forthcoming. 

Business Insider reported in September 2022 that TripActions (now Navan) filed confidentially for an IPO. In August 2023, Business Insider reported that Navan planned to have an IPO in April 2024. That didn’t happen. 

We’ll wait for the next reporting scoop to see if there will be an updated news story around the upcoming Navan IPO date. 

I’ll update this page with news and updates as we learn more. 

What is the Navan Ticker?

Navan is still a private company, so there is no Navan  stock symbol yet. 

Here are a few suggestions that are available in the U.S.:

What is the Navan Stock Price?

A public Navan stock price does not exist because the company remains private. 

Price estimates from pre-IPO marketplaces such as Hiive indicate Navan stock traded at around $6 in April 2024. 

Where is the Navan S-1 Filing?

Business Insider reported that Navan filed confidentially for an IPO as TripActions in September 2022. We’ve seen no other evidence to support this. 

Presumably, Navan withdrew its filing after rebranding. Business Insider’s August 2023 report indicated that Navan was on a path to an IPO. If true, we could see a Navan IPO filing in 2024. 

In the meantime, you can check out the most recent S-1 filings in our filings feed. 

How to Invest in Navan Stock

Buying private shares will likely become more challenging as Navan approaches its IPO date. Current shareholders are less likely to liquidate in private transactions when a public transaction is near. 

Aspiring shareholders can increase their chances of Navan ownership by taking the actions outlined below.

1. Monitor Navan equity availability on pre-IPO investing platforms

I have seen limited availability of Navan stock on pre-IPO platforms like  Hiive , EquityZen, Equitybee , Forge Global, and Linqto. Expect to pay at least a $10,000 investment minimum. In some cases, the minimum investment is much higher. 

These investing platforms offer direct ownership opportunities for accredited investors. To be eligible, you must open an account and sign up for alerts to be notified when Navan is available on the platform.  Signing up for online access to pre-IPO data and deal alerts is free. 

Non-accredited retail investors can bypass the accreditation requirement to own pre-IPO companies such as Databricks , Anduril, OpenAI , and Anthropic by owning the Fundrise Innovation Fund .

However, Navan stock is currently not present in the portfolio. Monitor my review for the latest additions to the fund. 

Please note: This is a testimonial in partnership with Fundrise. We earn a commission from partner links on AccessIPOs.com. All opinions are my own.

2. Participate in the Navan IPO via participating broker. 

Navan has previously filed confidentially for an IPO. That makes it likely to move forward. 

When it does, retail investors can position themselves to gain IPO access by opening accounts with the following online brokers and watching for IPO opportunities. 

• TradeStation  

Check out this list of best brokers for IPO investing to learn more about IPO access for retail investors.

Navan News Archive

10/13/2021: From $0 in revenue to a $7.25B valuation 11/08/2018: TripActions raises $154M with valuation north of $1B 03/07/2018: TripActions raises $51 million to take on corporate travel giants 01/24/2017: TripActions raises $14.6 million for its corporate travel booking tool 

Conclusion – Navan IPO

Navan is a popular enterprise SaaS for travel and expense management. Though not a household name, its fast growth over the past decade has caught the eye of venture capital investors. 

Now that it is past its Series G funding round, Navan is a possible candidate for an IPO. Business Insider has reported it could come in early 2024, but we’ve seen very little reporting or evidence to support this. 

Pre-IPO investing platforms have expanded opportunities for retail investors. Those who do not want to wait for an IPO can monitor pre-IPO platforms for availability and may be able to buy shares before the IPO. But as Navan approaches its offering date, opportunities to invest before the IPO may be limited.

Remember, investing in the Navan IPO comes with risks. Conduct thorough research and consider your risk tolerance before making any investment decisions. Good luck if you choose to buy Navan stock before or during the IPO. Invest at your own risk.

* Disclosure: The web page contains affiliate links from our partners. If a reader opens an account or buys a service from a link in this article, we may be compensated at no cost to the reader. Opening an account with a broker that provides access to IPOs does not guarantee the customer allocations of specific IPOs. The author is long HOOD and the Fundrise Innovation Fund. This article is not a recommendation to participate in the Navan IPO. 

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Citi and navan launch first complete travel and expense system for citi commercial bank clients.

Strategic agreement combines modern, end-to-end T&E experience with the power and reach of the world’s largest proprietary banking network

NEW YORK, October 19, 2023 --( BUSINESS WIRE )--Citi and Navan, a leading modern travel and expense management solution, today announced the launch of a new, jointly branded travel and expense system designed for Citi Commercial Bank (CCB) cardholders.

The strategic agreement, which combines Navan’s all-in-one solution and Citi's leading commercial card solutions, leverages the innovative card-link technology of Navan Connect to create a seamless digital experience for Citi Commercial Bank cardholders. As the industry’s first complete end-to-end corporate Travel and Expense (T&E) management collaboration of this scale, the system will initially be available only to U.S.-based Citi Commercial Bank clients.

Citi’s Treasury and Trade Solutions (TTS) business is collaborating with Citi Commercial Bank to deliver a differentiated offering for Citi’s mid-market clients. This new solution is complementary to Citi’s existing product offering for Commercial Bank clients, which includes leading solutions for Payments, Receivables, Liquidity Management, Foreign Exchange and Trade.

Gonca Latif-Schmitt, Global Head of Citi’s Commercial Cards, said, "Citi and Navan are now well-positioned to deliver a more efficient way to manage travel and expense programs, with a platform that’s easy to use for both travelers and finance teams, while aiming to alleviate the challenges that sometimes come with expense reporting for cardholders. This collaboration provides an opportunity for Citi to grow its Commercial Cards business by partnering with our Commercial Bank, while also offering travel booking and expense management technology."

Citi supports more than 25,000 global commercial card programs and 7 million cardholders worldwide, with more than $42 billion in annual charge volume in the U.S. alone.

"This agreement validates not just Navan’s technology — but also the value of the real-time visibility and control over spend that Navan offers finance teams and traveling employees," said Ariel Cohen, CEO and co-founder of Navan. "Before Navan Connect, banks were limited to offering their customers disparate travel and payment solutions. Today, Navan and Citi are helping to make travel and expense management easy for Citi Commercial Bank clients."

Citi is a preeminent banking partner for institutions with cross-border needs, a global leader in wealth management and a valued personal bank in its home market of the United States. Citi does business in nearly 160 countries and jurisdictions, providing corporations, governments, investors, institutions and individuals with a broad range of financial products and services.

Additional information may be found at www.citigroup.com | Twitter: @Citi | LinkedIn: www.linkedin.com/company/citi | YouTube: www.youtube.com/citi | Facebook: www.facebook.com/citi

About Navan

Navan is the all-in-one solution that makes travel and expense easy so you can focus on being there, not getting there. Say goodbye to spending hours on the phone trying to change your flight or saving stacks of receipts to manually input expenses. From EAs and finance teams to travel managers and employees, Navan empowers people to focus on the things that matter most to them — all while providing companies with real-time visibility, savings, and control. Learn more at navan.com

View source version on businesswire.com: https://www.businesswire.com/news/home/20231019169667/en/

Media Contacts Sarah Mac Rory, Communications for Citi Commercial Bank [email protected] +44 207 508 3822 Nina Das, Communications for Treasury and Trade Solutions [email protected] +1 212-816-9267 Kelly Soderlund, Senior Director of Global Public Relations [email protected]

No ‘Sugarcoating’: Travel Startup Navan’s Turbulent Ride Toward an IPO

Ceo ariel cohen takes a blunt approach to his job, from publicly firing executives to dropping f-bombs in an all-hands. the strategy has paid off for the business so far, but it concerns some current and former employees..

Ariel Cohen took the stage sipping champagne before 9 a.m. in front of more than 3,000 of his employees last month. Dozens of his travel software company’s workers, wearing purple pajamas, had just slept at the firm’s Palo Alto office. Another executive urged employees to get up and dance.

They were celebrating a rebrand of the company, formerly known as TripActions, to Navan. Executives viewed it as an important step on the road to an initial public offering, which the company is planning for later this year, according to people familiar with the matter.

“This is about being more aggressive, being more in your face,” Cohen told employees. The mercurial CEO has shown a tendency to bounce between charming some employees and insulting others. This all-hands meeting—which The Information listened to—was no exception. He laid into employees’ early designs of the firm’s new app. “It was bad; I’m looking at this and I’m like, ‘What the fuck is this?’” he said, dropping one of several F-bombs on stage.

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The Top 3 Travel Stocks to Buy in April 2024

April 27, 2024 — 07:15 am EDT

Written by Muslim Farooque for InvestorPlace  ->

InvestorPlace - Stock Market News, Stock Advice & Trading Tips

Top travel stocks are catching investors’ eyes with consumer spending patterns revealing resilience despite the economic headwinds.

Though the concerns over a hard landing remain, data indicates that consumers are still happily opening their wallets for travel experiences. Moreover, airfares, car rentals, and hotel rates dipped last month, another catalyst for the travel stocks. According to NerdWallet’s Travel Price Index , travel costs are down 2% on a year-over-year (YOY) basis, highlighting a unique opportunity for consumers and investors alike. Hence, this backdrop sets the stage for savvy investors to bet on travel stocks that could yield healthy returns. That said, here are three strong picks in the travel niche.

United Airlines (UAL)

Source: NextNewMedia / Shutterstock.com

United Airlines  (NASDAQ: UAL ) is a leading airline operator that has proven to be a marvel of operational excellence. Take it from its latest earning print, which showed another comfortable top-and-bottom-line beat, with solid YOY growth in sales. 

According to its management, UAL’s bottom line took a hefty $200 million hit from the Boeing 737 MAX 9 grounding. If it hadn’t been for that, UAL was most likely to deliver another quarterly profit. However, it ended up with a whopping $2.8 billion in operating cash flow and $1.5 billion in free cash flow, soothing investor concerns. Revenues were up almost 10% year over year on the back of stellar gains in Pacific and European regions.

Furthermore, despite the Boeing setback, UAL plans to purchase 61 narrowbody and 5 widebody aircraft this year. Also, it’s looking to expand its mid-continent hubs and build its international network further. Despite the positives, I agree with my fellow InvestorPlace contributor Josh Enomoto that UAL stock is heavily discounted relative to its pre-pandemic levels.

Marriott (MAR)

Source: MariaX / Shutterstock.com

Marriott  (NYSE: MAR ) is a giant in the hospitality space, which has rebounded remarkably well in the post-pandemic era. With a diverse portfolio of roughly 8,800 properties spanning 139 countries, it has established itself as a bona fide giant in its niche. Additionally, the company has consistently paid dividends since 1995, solidifying its long-standing commitment to returning value to shareholders.

Marriott wrapped up last year, generating sales of $23.71 billion , rising by 14% YOY. Moreover, it expanded its operations last year, adding 81,300 rooms, with revenue per average room (RevPAR) increasing by 15%. Additionally, it’s experiencing solid growth in international markets, especially in the Asia and European regions.

It’s not to say that it’s been all smooth sailing for the hospitality giant in the past year. Its high-end brands, such as Ritz-Carlton, have witnessed a slowdown in RevPAR in recent quarters. This trend suggests a leveling off in demand for luxury accommodations but is likely to be a temporary problem for Marriott. 

Corporacion America Airports (CAAP)

Source: Shutterstock

Corporacion America Airports  (NYSE: CAAP ) is a leading airport operator in the South American region, with 52 airports under its belt , serving over 80 million passengers annually. With its sizable operations in Argentina, including its primary Buenos Aires airports, and additional facilities in Brazil, Italy, Armenia, and other areas, CAAP’s influence is massive. Upwards of 81.1 million passengers utilized its facilities last year, making it a juggernaut in its niche.

Over the years, CAAP has proven to be a hugely profitable business. It has consistently outperformed the sector with its solid profit margins and return on equity, indicating efficient revenue conversion and shareholder value. Much of it concerns being an airport operator due to their nature as natural monopolies with low operational costs.

Looking ahead, CAAP recently posted an update that passenger traffic will increase by 0.8% YOY in March 2024, which points to an encouraging road ahead. Its stock has been up more than 50% in the past six months but still trades at a relatively attractive 11.31 times trailing twelve-month (TTM) earnings.

On the date of publication, Muslim Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com  Publishing Guidelines .

Muslim Farooque is a keen investor and an optimist at heart. A life-long gamer and tech enthusiast, he has a particular affinity for analyzing technology stocks. Muslim holds a bachelor’s of science degree in applied accounting from Oxford Brookes University.

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The post The Top 3 Travel Stocks to Buy in April 2024 appeared first on InvestorPlace .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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Navan Lays Off 145 People as Part of ‘Profitability’ Goal

Justin Dawes , Skift

December 6th, 2023 at 4:33 PM EST

Navan is doing clean-up towards profitability before its IPO, planned for next year.

Justin Dawes

Navan, a travel and expense management startup, has laid off 5% of employees at the company, accounting for about 145 people.

Kelly Soderlund, a spokesperson for Navan, said in an email that the layoff affected teams across departments. She did not confirm the exact number of people who were affected, but the Navan website says it has more than 2,900 employees across 40 offices globally.

“Navan has recorded strong growth over the past three years despite the challenges affecting our industry,” Soderlund stated. “We are refocusing efforts to move faster toward profitability as we enter the next phase of the company. As such, we have made the difficult decision to reduce the size of our global workforce by 5% to increase operational efficiencies as we continue to reinvent travel and expense through innovation.”

The Information was the first to confirm the news.

The Navan Connect platform is meant to eliminate expense reports for traveling employees and reconciles transactions for corporate finance departments.  

Navan has raised well over $1 billion in venture capital, most recently $154 million in a series G round in October 2022. The company has been building and expanding partnerships during that time, most recently with Citi .

Navan reportedly filed confidential paperwork in September 2022 for an IPO at a $12 billion valuation, though the company did not share information about specific plans or timing with Skift. Soderlund did not respond to a new question about the timeline of going public, though a Business Insider story from August said that it is aiming for a late April 2024 IPO. That itself of course is dependent on how the IPO window looks then.

Navan is among a growing number of expense management platform companies and startups, many of which have raised venture capital this year. Rivals include SAP Concur, Expensify, Egencia, and TravelPerk. 

Ariel Cohen, co-founder and CEO of Navan, spoke at the 2023 Skift Global Forum about the challenges of implementing AI. He announced at the event that Navan was launching Hotel Concierge by Ava, the latest in a series of updates to its traveler-facing chatbot Ava . 

Travel Tech Sector Stock Index Performance Year-to-Date

What am I looking at?  The performance of travel tech sector stocks within the  ST200 . The index includes companies publicly traded across global markets including online travel, booking, and travel tech companies.

The Skift Travel 200 (ST200)  combines the financial performance of nearly 200 travel companies worth more than a trillion dollars into a single number.  See more travel tech sector financial performance .

Read the full methodology behind the Skift Travel 200.

The Daily Newsletter

Our daily coverage of the global travel industry. Written by editors and analysts from across Skift’s brands.

Have a confidential tip for Skift? Get in touch

Tags: business travel , expense management , layoffs , navan

Insider Q&A: Avelo Airlines CEO Andrew Levy describes the challenges of starting a new carrier

It’s not easy to break into the U.S. airline industry, which is dominated by four big carriers and a sprinkling of other niche players, but that didn’t scare away Andrew Levy.

Neither did a pandemic that briefly caused air travel to plummet more than 90%.

In April 2021, while COVID-19 still raged and billions of dollars from taxpayers were propping up big airlines, Levy launched Avelo Airlines with flights between Burbank, California, and Las Vegas.

The airline saves money by flying older Boeing 737 jets that can be bought at relatively low prices. It operates out of less-crowded and less-costly secondary airports, and flies routes that are ignored by the big airlines.

Levy was involved in the launch of ValuJet, which became Allegiant Air, and he also did a stint as the chief financial officer of United Airlines before starting Avelo (it rhymes with yellow).

He spoke with The Associated Press about the challenges of starting a new airline, how the carrier is doing, and plans to sell shares to the public. The answers were edited for length and clarity.

Q: Why did you think you should start a new airline?

A: Shortly after I left Allegiant in 2014, I actually started thinking about about doing this. The market had become very consolidated, and there was a lot of opportunity that was out there that wasn’t being served by the existing, incumbent carriers. You have these four behemoths that are massive, that are protected by the government it seems, because certainly they’re stronger than they have ever been, after the pandemic. My view was we had room for more.

Q: What have you learned?

A: While there are these four behemoths, the toughest challenge, quite honestly, might even be the regulatory regime. For smaller companies like ours, it imposes these really substantial burdens on us. I’ll give you an example. For the (Department of Justice) lawsuit (against) JetBlue and Spirit, we had to go spend a ton of money on our end to produce documents for something that we really didn’t care how it ended up. And they’re trying to get us to do the same thing for Alaska-Hawaiian, which again, we could care less if Alaska and Hawaiian merge.

Q: How do you get people to fly on a new airline?

A: Number one, you have an awareness issue. You want people to know that you exist. So that’s one challenge, which is more of a marketing challenge. The other challenge is of course getting people to trust you. Like, ‘Who are these people? Are they going to really get me there? What’s the airplane going to look like? Is it safe? Is it reliable? What happens if something goes wrong?’ All those questions that most consumers may have when they think about choosing an airline that perhaps they’re unfamiliar with. You just have to focus on doing a really great job. Obviously not every flight is on time, but as time goes on I think people recognize that, hey, you know what? These guys offer a lot of value. We offer great convenience.

Q: Where does the name, Avelo, come from?

A: There’s no great story there. I wish I could tell you it was. It was a play on two words: velocity, which is swift in Latin, and convenience.

Q: Avelo reported a profit for fourth quarter 2023 but gave no details. Was that on a GAAP (generally accepted accounting principles) basis? And how much was it?

A: We actually have cash that generates interest income nowadays. Those are GAAP numbers where we have audited financials from Ernst & Young. These are real numbers with no adjustments or anything else. I’m not going to give you the numbers because we are a private company and so we have no real need to provide that kind of information. I’ll tell you that we made money in the first quarter as well.

Q: You've talked about your cost advantage as a startup. Is that sustainable?

A: Most costs creep up over time for every airline because our labor costs are tied to pay scales, but it is very sustainable. It’s based on how we designed the business. We distribute our product directly to the customer so we don’t use third-party intermediaries. We go in to smaller, more convenient, less-expensive airports. Your taxi times are lower; you’re not burning gas. We spend money on things that matter, and that includes our people. Our pilot pay is very competitive. It’s not the same as United Airlines, but it’s extremely competitive. We operate older equipment also — midlife (Boeing) 737 NGs, and those are certainly less expensive than brand-new aircraft. They burn a little bit more gas, but not much, and we like that trade.

Q: Do you plan to sell stock to the public, and when?

There’s obviously two issues. The single biggest one is one we don’t control, which is when are the IPO markets going to be actually open and vibrant, and they’re not right now. Beyond that, we have to be ready as a company. We put two straight quarters of profits ... so we expect every quarter this year to be profitable. We hope that we’ll have a company that people would want to own, and hopefully by year end or sometime next year. There’s no magic to being public for us. It’s just that historically that is typically the best way to access the capital markets for companies like ours. It is a very capital-intensive industry.

Q: What advice would you give to somebody else looking to start a business?

A: There’s nothing more rewarding than taking control of of your destiny. Just make sure you know what you think you know about whatever it is you’re going to start. I think you have to be wired a certain way to want to do something like this because it’s unbelievably difficult. I’ve been at this now for almost six years. When we get to a certain point, I’ll look back and feel really good about what we’ve done. We’re not there yet, but we’re getting close.

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A rebound in asia travel will likely drive estée lauder’s q3 performance.

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SEOUL, SOUTH KOREA - AUGUST 04: South Korean actress and singer of SNSD Yoona attends the photo call ... [+] for "Estee Lauder Lounge" pop-up store opening event at Seongsu Infomal Square on August 04, 2023 in Seoul, South Korea. (Photo by The Chosunilbo JNS/Imazins via Getty Images)

Estée Lauder (NYSE: EL) will report its Q3 fiscal 2024 ((the fiscal year ends in June) results on Wednesday, May 1. We expect the company to post sales of $3.9 billion and earnings of $0.46 per share, marginally below the consensus estimates. Estée Lauder expects a better performance in the second half of fiscal 2024, both in terms of sales and profitability. This can be attributed to an expected recovery in Asia travel and mainland China. Although we expect Estée Lauder to post Q3 results marginally below the street estimates, we believe there is some room for its stock to grow from its current levels of under $145. Our interactive dashboard analysis of Estée Lauder’s Earnings Preview has more details on how the company’s revenues and earnings will likely trend for the quarter. So, what are some of the trends that are likely to drive Estée Lauder’s results?

Firstly, let us look at EL stock performance in recent years. EL stock has suffered a sharp decline of 45% from levels of $265 in early January 2021 to around $145 now, vs. an increase of about 35% for the S&P 500 over this roughly three-year period. However, the decrease in EL stock has been far from consistent. Returns for the stock were 39% in 2021, -33% in 2022, and -41% in 2023. In comparison, returns for the S&P 500 have been 27% in 2021, -19% in 2022, and 24% in 2023 — indicating that EL underperformed the S&P in 2022 and 2023.

In fact, consistently beating the S&P 500 — in good times and bad — has been difficult over recent years for individual stocks; for heavyweights in the Consumer Staples sector including WMT, PG, and COST, and even for the megacap stars GOOG, TSLA, and MSFT. In contrast, the Trefis High Quality Portfolio , with a collection of 30 stocks, has outperformed the S&P 500 each year over the same period. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics .

Given the current uncertain macroeconomic environment with high oil prices and elevated interest rates, could EL face a similar situation as it did in 2022 and 2023 and underperform the S&P over the next 12 months — or will it see a recovery? From a valuation perspective, we think EL stock has some room for growth. We estimate Estée Lauder’s Valuation to be $163 per share, reflecting over 10% upside from its current levels of $145. Our forecast is based on 4x forward sales, aligning with the stock’s average P/S multiple over the last two years.

EL Annual And Quarterly Revenue

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Looking at the previous quarter, Estée Lauder’s revenue of $4.3 billion in Q2 was down 7% y-o-y. The company reported a 10% fall in Skin Care sales, 8% decline in Makeup sales, 5% fall in Hair Care revenues, and Fragrance revenues were flat y-o-y. This can be attributed to a weakening consumer spending environment and continued softness in prestige beauty demand in China. The company reported an operating margin of 13.4% in Q2’24, reflecting a 140 bps rise y-o-y. The adjusted EPS stood at $0.88, vs. $1.54 in Q2 2023, reflecting a sharp 43% decline.

Coming to the latest quarter, Estée Lauder is expected to benefit from a rebound in mainland China and Asia travel demand. The prestige beauty demand in China may see some improvement sequentially. The company expects 4% to 6% organic sales growth and adjusted earnings to be in the range of $0.36 and $0.46 per share in Q3.

While EL stock looks like it has little room for growth, it is helpful to see how Estée Lauder’s Peers fare on metrics that matter. You will find other valuable comparisons for companies across industries at Peer Comparisons .

EL Return Compared With Trefis Reinforced Portfolio

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