Coty Inc. (COTY) Intrinsic Value & DCF Valuation
Household & Personal Products · NYSE
Current Price
$2.69
Intrinsic Value
$2.84
+5.1% margin of safety
What Is Coty Inc.'s Intrinsic Value?
As of 2026-07-30, the base-case DCF model estimates the intrinsic value of Coty Inc. (COTY) at $2.84 per share, compared with a market price of $2.69, a margin of safety of +5.1%. The base case assumes -1.9% annual free cash flow growth and a 10.0% discount rate.
Across the sensitivity grid the estimate spans $2.08 to $3.73. Intrinsic value is an estimate built on assumptions, not a fact. A higher discount rate or slower growth pushes the estimate down, while stronger cash flow growth lifts it.
How the DCF works · Recalculate with your own assumptions · What is intrinsic value?
Is Coty Inc. (COTY) Undervalued?
At $2.69, COTY trades about 5.1% below the base-case intrinsic value estimate. That is a real discount, but it stays short of the 30% margin of safety required before calling a stock undervalued.
COMPETITIVE MOAT
↑Brand Portfolio Strength
Coty possesses a diverse portfolio of well-established brands across beauty and fragrance. This breadth allows for broad consumer appeal and market penetration.
↑Distribution Network
The company benefits from extensive global distribution channels, reaching consumers through various retail and online platforms. This wide reach is difficult for new entrants to replicate.
↑Licensing Agreements
Strategic licensing deals with luxury fashion houses provide access to high-demand, premium fragrance and beauty markets. These partnerships offer a consistent revenue stream and brand prestige.
INVESTMENT RISKS
↓Securities Lawsuit Allegations
Recent class action lawsuits alleging securities law violations could lead to significant legal costs and reputational damage. This uncertainty impacts investor confidence and potential financial liabilities.
↓Stock Performance Volatility
A substantial decline in stock price following earnings reports indicates market concerns about financial performance or future outlook. This volatility can deter investment and affect capital raising efforts.
↓Leadership Restructuring
Ongoing leadership structure and operating model adjustments suggest internal challenges or a need to adapt to market dynamics. Such changes can create short-term operational disruptions.
Base case
COTY base case valuation
Intrinsic Value
$2.84
Margin of safety
+5.1%
Expected annual return
+1.1%
Base case assumptions: -1.9% annual growth, 10.0% discount rate, 8x exit multiple, 5 year projection. Data as of 2026-07-30.
This base case uses default assumptions and is not financial advice. The intrinsic value changes significantly when the growth rate or discount rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the COTY valuation
Adjust the growth rate, discount rate, and exit multiple to see how the intrinsic value and margin of safety for Coty Inc. respond.
Open DCF Calculator for COTYCompany Overview
Coty Inc., together with its subsidiaries, manufactures, markets, distributes, and sells branded beauty products worldwide. It operates through two segments: the Prestige and Consumer Beauty. The company provides fragrance, color cosmetics, and skin and body care products. It offers prestige products through prestige retailers, including perfumeries, department stores, e-retailers, direct-to-consumer websites, and duty-free shops under the Burberry, Calvin Klein, Chloe, Davidoff, Escada, Etro, Gucci, Hugo Boss, Infiniment Coty Paris, Jil Sander, Joop!, Kylie Cosmetics by Kylie Jenner, Lancaster, Marc Jacobs, Orveda, philosophy, and Tiffany & Co. brands. The company provides beauty products through hypermarkets, supermarkets, drug stores, pharmacies, mid-tier department stores, traditional food and drug retailers, and e-commerce retailers under the Adidas, Beckham, Bozzano, Bourjois, Bruno Banani, CoverGirl, Jovan, LeGer by Lena Gercke, Max Factor, Mexx, Monange, Nautica, Paixao, Rimmel, Risque, Vera Wang, and Sally Hansen brands. It also sells its products through third-party distributors. The company was founded in 1904 and is headquartered in New York, New York. Coty Inc. is a subsidiary of JAB Beauty B.V.
Financial Metrics — COTY Stock Valuation Data
Revenue/Share (TTM)
$6.58
FCF/Share (TTM)
$0.35
ROIC (TTM)
3.8%
ROE (TTM)
-15.1%
P/FCF
7.6x
EV/EBITDA
56.2x
FCF Yield
13.13%
Debt/Equity
1.15x
On a trailing twelve-month basis, COTY generates free cash flow per share of $0.35 alongside a ROIC of 3.8%, both central inputs for a DCF valuation. Its P/FCF ratio of 7.6x and FCF yield of 13.13% then frame how COTY is priced against peers on a cash flow basis.
Frequently Asked Questions
What is the intrinsic value of COTY?
Coty Inc. currently generates $0.35 in free cash flow per share. At the current price of $2.69, a DCF model would discount these cash flows at an appropriate WACC and apply a terminal growth rate to arrive at an intrinsic value. The result depends heavily on your growth and discount rate assumptions — a 1% change in WACC typically shifts the fair value estimate by 10-15%. In MiniValuator the model uses a single discount rate that you can edit directly, 10% by default, rather than a computed WACC.
Is COTY undervalued?
COTY trades at a P/FCF ratio of 7.6x with a free cash flow yield of 13.13%. A low P/FCF means investors are paying less per dollar of free cash flow; whether that is cheap depends on the company's growth, cyclicality, and capital intensity. However, whether COTY is truly undervalued requires comparing the DCF intrinsic value to the current market price and evaluating whether the margin of safety is sufficient for your risk tolerance.
How do I value COTY stock using DCF?
To perform a DCF valuation on Coty Inc.: (1) Start with the trailing free cash flow per share ($0.35) as the base, (2) project future FCF growth over 5-10 years based on Household & Personal Products industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting COTY's risk profile — with a debt-to-equity of 1.15x, capital structure is an important factor, and (4) add a terminal value for cash flows beyond the projection period.
What is DCF valuation and how does it apply to COTY?
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For Coty Inc., this means projecting how much free cash flow the company will produce over the next 5-10 years, shaped by Household & Personal Products trends, then discounting those amounts to today's dollars. COTY's ROIC of 3.8% means the company's return on invested capital sits below the level that typically clears its cost of capital.
How does WACC affect COTY stock valuation?
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For COTY, with a debt-to-equity ratio of 1.15x, the capital structure directly influences WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%. At an EV/EBITDA of 56.2x, the market's implied discount rate can be reverse-engineered for comparison. In MiniValuator you set this discount rate yourself as a single editable number, 10% by default, instead of computing a formal WACC.
Learn More
- See COTY PE Valuation → — Earnings-based stock valuation using PE ratio analysis
- DCF Methodology — Step-by-step guide to discounted cash flow analysis
- PE Methodology — Guide to PE ratio stock valuation
- WACC — Understanding the discount rate used in DCF
- Margin of Safety — How to evaluate downside protection
- Intrinsic Value — How to evaluate stock fair value
- How to Calculate Intrinsic Value — Complete guide for investors
Related Valuations
All Consumer Defensive valuationsDCF and P/E value COTY with different methods and assumptions, so the two conclusions can differ. Compare the P/E fair value.
Price as of 2026-07-30. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.