Estée Lauder Companies (ELC) has secured fresh backing from the investor who became famous for betting against the US housing market before the 2008 global financial crisis.
Michael Burry, portrayed in the film The Big Short by Christian Bale, has doubled his firm’s stake in ELC amid a streamlining of the beauty giant by newly installed President and CEO Stéphane de La Faverie.
Scion Asset Management now owns 200,000 shares of ELC valued at US$13.2m according to regulatory filings, Reuters reports – double the number of shares it held at the end of last year.
Cosmetics Business has contacted Scion Asset Management for comment.
"Burry's bet suggests belief in Estée Lauder's ability to reclaim its status as a beauty powerhouse in an increasingly competitive global market," Angeli Gianchandani, a global brand marketing expert at New York University, told Reuters.
Morningstar analyst Dan Su told the publication the move was a positive one amid the CEO’s efforts to turn around falling sales, though noted “the position size of the investment is not very large”.
ELC has a market capitalisation of $23.45bn at the time of writing.
The owner of Clinique, MAC Cosmetics and Jo Malone London has faced a tough start to 2025.
Third quarter sales plunged 10% as it faced a slowdown in China and travel retail in Asia, following a 6% slump in the second quarter.
De La Faverie announced plans in February to cut up to 7,000 jobs as part of a strategic plan to turn things around called Beauty Reimagined.
The beauty boss said at the time that the plan is a “bold strategic vision to restore sustainable sales growth and achieve a solid double-digit adjusted operating margin over the next few years”.
As part of the plan, ELC will accelerate product launches targeting high-growth channels and markets, particularly in the prestige beauty space, and increase advertising spend.
ELC’s share price was up just over 2% on Friday after Scion Asset Management’s position was disclosed.