The Impact of War and a Proposed Merger Hurt Estee Lauder Companies (EL) in Q1

Soumya Eswaran Thu, July 2, 2026 at 9:51 AM EDT 3 min read **

• EL

Hardman Johnston Global Advisors, an investment management firm, issued its investor letter for the Hardman Johnston Large Cap Equity Strategy for the first quarter of 2026. A copy of the letter can be downloaded here. The strategy achieved a return of 0.68% (gross) and 0.57% (net) during this period, in contrast to a -4.33% return for the S&P 500 Total Return Index. Companies with robust backlogs of customer business were rewarded, while those with more economically sensitive clients faced underperformance. Looking beyond the immediate disruptions, the firm believes the overall outlook for the U.S. economy remains positive. Please review the Strategy's top five holdings to gain insights into their key selections for 2026.

In its first-quarter 2026 investor letter Hardman Johnston Large Cap Equity Strategy highlighted The Estée Lauder Companies Inc. (NYSE:EL). The Estée Lauder Companies Inc. (NYSE:EL) is a leading cosmetic company that manufactures, markets, and sells skin care, makeup, fragrance, and hair care products. On July 1, 2026, The Estée Lauder Companies Inc. (NYSE:EL) closed at $82.47 per share, reflecting a market capitalization of $29.84 billion. The Estée Lauder Companies Inc. (NYSE:EL) posted a one-month return of -0.52%, while its shares lost 7.04% over the past 52 weeks.

Hardman Johnston Large Cap Equity Strategy stated the following regarding The Estée Lauder Companies Inc. (NYSE:EL) in its Q1 2026 investor letter:

"Detractors were led by The Estée Lauder Companies Inc. (**NYSE:EL). While there remains a strong case for accelerating profit growth based on better execution and a more efficient operation, the combination of the war and its impact on consumer spending, along with a proposed merger with a competitor caused the stock price to reset. We will evaluate whether our 3-5 year thesis is affected by these events."

Estée Lauder (EL) Faces PT Cuts from JPMorgan and Barclays Ahead of Earnings The Estée Lauder Companies Inc. (NYSE:EL) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 47 hedge fund portfolios held The Estée Lauder Companies Inc. (NYSE:EL) at the end of the first quarter, compared to 50 in the previous quarter. While we acknowledge the potential of The Estée Lauder Companies Inc. (NYSE:EL) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on thebest short-term AI stock.

Story Continues In another article, we covered The Estée Lauder Companies Inc. (NYSE:EL) and shared the list of best consumer staples stocks to invest in. In addition, please check out our hedge fund investor letters Q1 2026 page for more investor letters from hedge funds and other leading investors.