DA Davidson highlights Coty’s share repurchase potential

Investing.com -- DA Davidson highlighted Coty Inc 's (NYSE: COTY) plans to sell its $1.1 billion stake in Wella by December 2025. Brokerage noted that with a lockup provision expiring, Coty has greater flexibility in securing a buyer.

“We think proceeds could be deployed toward share repurchase,” analyst added.

Analysts at DA Davidson believe that the sale proceeds, while not required to meet the company’s leverage target of 2x by late 2025, could be used for share repurchases. They estimate that a $1.1 billion buyback could reduce Coty’s share count by 17% and boost fiscal 2026 earnings per share by 19%.

“Despite the CEO's solid track record, shares are inexpensive.”

Coty was added to STAMPEDE list, which is DA Davidson’s "Portfolio Restructuring" category, which identifies stocks benefiting from structural corporate changes. DA Davidson emphasized that despite strong leadership, Coty shares remain attractively valued at 6.4 times estimated 2026 EBITDA.

The STAMPEDE list, curated by DA Davidson’s senior analysts, tracks companies undergoing strategic shifts, including spin-offs, takeovers, and capital restructurings.

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