There's nothing like a thesis that keeps paying off in thick and thin and up and down, able to withstand everything from a Federal Reserve hike to a destructive presidential tweet.
And you know which one has the ultimate staying power this quarter?
The need to be entirely vain and to look your selfie-best no matter what the circumstances.
This morning we got a quarter from Estee Lauder (EL) that astounded the Street with how robust it was. The growth was across the board, with China and Hong Kong, both markets that had been questionable of late, standing out as regions with terrific growth.
More important, Estee Lauder has adjusted to the look-your-selfie-best generation in extraordinary style. With its products at one time being the province of only the richest of the rich, the blue-chip cosmetics giant has figured out a masterful game plan that deals with new outlets like e-commerce as well as places that you might not expect to find a brand we are used to seeing only at the highest of high-end stores.
It's a brilliant move because it mitigates the single biggest worry I had, the dependence on mall-based stores like Macy's (M) , which is closing so many doors. Instead, it's Sephora, the hottest of the hot that can even bring people into a J.C. Penney (JCP) , and Ulta (ULTA) , long my favorite that gives everyone, no matter what the income group, a shot at all sorts of Estee Lauder brands.
I think that more than anyone, Fabrizio Freda, Estee Lauder's perennially youthful CEO, just gets it and has pulled off the impossible, a non-cannibalistic move that captures teenagers around the world who must-must-must look better than they do the moment they step out because of the high-def screen of their iPhone and the Facebook, Instagram and Snap recordings of their comings and goings. I think it's early on as the stock has done nothing for a pretty long time because of a slowdown in Hong Kong that's no longer the case and because, as Fabrizio says, "Consumers' appetite for beauty products is intensifying" and it has "superb growth in the fastest-growing beauty channels."
Estee Lauder's breakout numbers come on the heels of a quarter from Align Technology (ALGN) that truly can only be ranked as one of the greatest affirmations of the look-your-selfie-best theme. Align's Invisalign non-traditional braces sold like proverbial hotcakes, up 9% sequentially and 27% year over year, an astounding statistic. It's a product, by the way, that has a ready-made group of proselytizers, the worldwide dental community, which is desperate for new products to offer patients given the plethora of dentists who have driven the salaries of these professions.
Dentists attest that teenagers are begging their parents for these devices that can be off in as short a time as three months and produce the smile that you can't go without if your friends are checking you out on Snap 18 times a day.
Where does this all end? While shipments set a record at 208,000 cases, teenage customers taking the product advanced 11% sequentially. Accelerating sales for a product that gives you your selfie best? The stock may still be a buy even as it has run 37% for the year.
Great-looking faces, fabulous smiles? Looking your selfie best is a thesis to sink your teeth into any time the market goes south.
