The retail sector's not doing terribly well this year amid the coronavirus pandemic as many brick-and-mortar shops have shut down this year. Consumers are opting for online purchases instead and are making fewer in-store trips. However, for businesses that can adapt and sell their products online, they've been able to do well even during a tumultuous 2020.
Coty Inc (NYSE:COTY) isn't having a great year but it is doing well of late. The company's associated with many popular brands, including big names like Burberry, Calvin Klein, and Hugo Boss. Last week, the company released its first-quarter results for fiscal 2021 and it came ahead of Wall Street's expectations. Sales of $1.12 billion for the period were down more than 20% year over year but still beat analyst projections.
A big part of the company's success was due to the growth of its online sales, as CEO Sue Nabi stated that "we have seen double-to-triple digit e-commerce sell-out growth across most markets, with our e-commerce penetration as a percentage of our overall sales doubling to 13%."
Its online sales are still a fairly modest size of its overall revenue and the good news for investors is that there's still an opportunity there for a greater penetration as more people do their shopping online. Another bright spot was its bottom line, with Coty's net income of $221.4 million more than quadrupling last year's tally in Q1, which was just $52.3 million.
Despite the bump in share price last week, shares of Coty are still down more than 60% year to date. Trading right around book value, this is a cheap (but risky) investment, as possible shutdowns amid rising COVID-19 case numbers threaten the strength of its business.
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