Unusual Options Activity In Coty

6 days ago
2 Min Read
443 Words


Coty is one of the world’s largest beauty companies with an iconic portfolio of brands across fragrance, color cosmetics, hair color and styling, and skin and body care. Coty is the global leader in fragrance, a strong number two in professional hair color & styling, and number three in color cosmetics. Coty Inc., ended up buying a 51% stake in Kylie Cosmetics for $600 million making Kylie the youngest ever billionaire a couple of years ago.


Coty chairman Peter Harf said at the time that Kylie is a modern-day icon, with an incredible sense of the beauty consumer. But then Forbes came out with an article stating Kylie’s business is significantly smaller, and less profitable, than the family has spent years leading the cosmetics industry and media outlets to believe. And after the number crunching, Forbes said personal fortune was just under $900 million, despite the headlines surrounding the Coty deal that seemed to confirm her billionaire status. The stock sold off on the news.

In July of 2019, Coty Inc. and Kim Kardashian West announced a strategic partnership will focus on entering new beauty categories and global expansion beyond her existing product lines. Under the terms of the agreement, Coty acquired a 20% ownership interest in Kardashian West's beauty business for $200M. But the new pushed up the stock price, but it wasn’t sustained.

However, last month Coty stock after an upgrade from Jefferies. The analsyst, Stephanie Wissink said with sour sentiment and low expectations, any positive news could lead to a 30% spike in price.

And today, Citibank upgraded the Coty pre-market.

Coty is jumping 12% early Thursday, helped by a bullish endorsement from Citigroup, which believes that the beleaguered beauty products maker’s recent rally has legs.

Analyst Wendy Nicholson boosted her rating on Coty (ticker: COTY) to Buy from Neutral, and more than doubled her price target to $10, from $4.50. She acknowledges that the shares have moved up sharply from their lows in the spring, but argues that the company’s recent earnings report shows that the Coty can continue to climb, especially under new leadership.


The Smart Money was all over this as they bought over 29,000 call options that expire on Dec 6th.


I was actually looking to jump in with the Smart Money, but price had spiked too high to make it worth my money. However, I do think the stock could move higher, at least to the daily supply at $9.


This post is my personal opinion. I’m not a financial advisor, this isn't financial advise. Do your own research before making investment decisions.

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