Puig Earnings: Solid Profit Growth Fueled by Fragrance, Skincare, and Makeup in Early Innings

No-moat beauty product maker Puig posted solid 2024 results. While there was no surprise on the sales result (which was announced Jan. 30), adjusted EBITDA of EUR 969 million rose 12% and edged our EUR 958 million estimate by 1% on expense leverage. For 2025, we plan to trim our 8.3% sales growth forecast to align with the company's 6%-8% outlook as we incorporate normalizing fragrance sales and potential US retailer caution, given tariff uncertainties. However, we expect this to be more than offset by better efficiency gains from merger integration, resulting in a low-single-digit percentage lift to our prior 2025 adjusted EBITDA estimate. Our EUR 23 fair value estimate remains in place.