Coty Inc. Class A Common Stock (COTY)

FairStock Score: 45/100 — MIXED

Key Financials

Strengths

• Generates $403 million in annual free cash flow (19.4% yield on market cap)
• Established organization with 11,636 employees providing operational scale

Concerns

• Currently unprofitable—sustained losses could lead to dilutive capital raises or balance sheet deterioration
• Altman Z-Score of -0.4 places it in the financial distress zone—elevated bankruptcy risk

AI Analysis

Coty Inc. Class A Common Stock is a small-cap consumer defensive company valued at $2.1 billion. Revenue stands at $5.8 billion, though the company is currently unprofitable. From a quality standpoint, Coty shows distressed Altman Z-Score of -0.4 warrants caution and negative ROE indicating losses. On valuation, the stock is strong 24.8% free cash flow yield. Growth dynamics show revenue growing at 0.5% and profit growth of -621.5%. Our composite FairStock Score of 45/100 reflects mixed fundamentals overall. Without profitability, this remains speculative—suitable only for those with high risk tolerance and a long time horizon.

Bull Case

Improving fundamentals and sector tailwinds could drive meaningful earnings growth, compressing the effective multiple for patient investors. With $403 million in annual free cash flow (19.4% yield), management has ample capital for buybacks, dividends, or accretive acquisitions.

Bear Case

Without a clear path to profitability, continued cash burn forces either dilutive equity raises or debt accumulation that destroys shareholder value. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer