Barclays sees big haircare gains for this consumer stock as shoppers prioritize self-care
This consumer stock's burgeoning haircare segment is being overlooked despite consumers continuing to splurge on self-care routines, Barclays says.
TL;DR
- Barclays believes investors are underestimating the growth potential of Henkel's haircare business.
- Consumers are continuing to prioritize self-care routines, benefiting the haircare market.
- Henkel has expanded its haircare portfolio through acquisitions like Olaplex and Not Your Mother's.
- Haircare is becoming the "centrepiece" of Henkel's Consumer Brands portfolio, surpassing more mature businesses.
- The haircare market is valued at approximately $70.4 billion and is driven by sophisticated consumer routines, innovation, and premiumization.
- Haircare is a more resilient and profitable category for Henkel compared to laundry and homecare, less impacted by raw material costs and trading-down trends.
- Barclays sees the U.S., China, and Mexico as key growth markets for Henkel's haircare products.
- Henkel needs to demonstrate sustained market share gains from its expanded brand portfolio.