Browsing by Author "Pinto, Mariana Gomes Maia"
Now showing 1 - 1 of 1
Results Per Page
Sort Options
- Equity valuation : L´Oréal S.A.Publication . Pinto, Mariana Gomes Maia; Martins, José Carlos TudelaL’Oréal is the largest cosmetic company in the world. Currently, the company has a portfolio of 36 brands, and it’s present in more than 150 countries. In 2018, L’Oréal attained a sales revenue of €26.9 Bn, a growth compared to the previous year of +7.1%. The purpose of this dissertation is to present a valuation of L’Oréal to get to its fair value estimation price. In this sense, three methodologies were applied – Discounted Cash Flow (DCF), Relative Valuation, and Dividend Discount Model (DDM). Through the Discounted Cash Flow methodology, L’Oréal fair price was valued in 257.8€. The Relative Valuation result is not included in the investment recommendation since this valuation is very susceptible to be influenced by the chosen peers. This method is preferably used to get a feel on the valuation investors are expecting on similar types of companies and to understand the market situation better. The Dividend Discount Model was used to establish a lower bound of the fair value since it’s a more conservative model. In the end, a comparison to the equity research note issued by J.P. Morgan on 31st July 2019 was performed along with an investment recommendation.