Kylie Jenner, Not COVID-19, Is to Blame for the S&P 500s Weakest Stock
The worst-performing stock in the entire S&P 500 is Coty Inc.
Despite a massive recovery in rivals like Estee Lauder and L’Oreal, the beauty company has hugely unperformed the U.S. stock market.
Controversy surrounding Kylie Jenner is likely the cause; can a partnership with Kim Kardashian-West save the day?
After tumbling 60% from its open in 2020, beauty company Coty Inc. (NYSE:COTY) has collapsed in value since the start of the pandemic. Don’t just blame COVID-19; this stock’s woes are mostly due to Kardashian family member Kylie Jenner.
Kylie Jenner’s Deal With Coty Has Not Gone Smoothly
When Kylie Jenner signed a massive deal with Coty in November 2019, things were looking up for the American beauty giant.
It had already been a rough start to the year for Coty, with the pandemic gutting consumer demand and tanking the S&P 500.
Kylie Cosmetics Sued by Seed Beauty
Unfortunately, the problems didn’t stop here for Coty. Seed Beauty, the exclusive manufacturer of Kylie Cosmetics products, accused the beauty giant of acquiring the company as “subterfuge” to learn Seed’s confidential trade secrets.
The process has not gone smoothly. While the S&P 500 has risen like a phoenix, COTY stock is still languishing at the bottom of the pile.
Based on analysts offering 12 month price targets for COTY in the last 3 months. The average price target is $5.64 with a high estimate of $8 and a low estimate of $4.
To salvage the miserable situation, Coty is doubling down on the Kardashian family, as Kim recently announced a high-profile collaboration with the corporation. The deal, which was announced July 2, has helped boost Cody’s standing.
Video: Kim Kardashian-West Inks Deal With Coty Inc.
Still, after the damage caused by the Kylie Cosmetics debacle, it remains to be seen if having Kardashian-West on board can help get Coty back on track.
Disclaimer: The opinions expressed in this article do not necessarily reflect the views of CCN.com. Unless otherwise noted, the author has no position in any of the securities mentioned.