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Beauty values are turning heads while some of the renowned names in the space niche are gaining double digits this year.
Sales of cosmetics have also accelerated, as the millennial rise on popular social media platforms such as Instagram and Twitter has helped businesses promote and meet the needs of their major consumers.
"Consumers are becoming more and more vocal and have more say in products, especially in social media," said in an interview Alison Gaither, beauty badyst at Mintel, a market research company. "Brands react and it's something they were not able to do before."
According to a technician, the charts suggest that the trend in the wider consumer space is still on the rise.
"They had a pretty substantial series, but you look at things like the S & P household and personal products index recently. [they] Mark Newton, founder of Newton Advisors, said Wednesday on CNBC's "Trading Nation" television. "In my opinion, it is therefore really a secular event in the longer term."
Newton's mapping reveals that, compared to the more general consumer goods sector – which is stable over the year – the household and personal products sub-sector has "broken with a bearish trend of nearly 10 years "and constitutes a good defensive game for investors who wish to negotiate the space.
"You know that you want to be a staple and that household and personal products seem to be an interesting area to be part of this group that can show leadership," said Newton.
Conversely, Stacey Gilbert, Head of Derivatives Strategy at Susquehanna Financial Group, believes that the cosmetic values may have evolved too quickly. Gilbert referred to the shares of cosmetics maker Avon, which recorded Wednesday a new record of 52 weeks.
"We do not see any bearish flow, it's more of a profit taking here," she told Trading Nation Wednesday.
In addition, Gilbert pointed out that while Coty still has potential for long-term investors, its special offer was boosted by the announcement of the company's call for bids. Investment JAB Holding earlier this week.
"It seems that there is a longer-term potential, but in the shorter term via the options, I would say that investors are preparing for a downturn or at least worst case scenario, that's just a break here, "she said.
The beauty shares were blended Thursday with Coty shares, e.l.f Beauty and Ulta up slightly, while Estee Lauder was in the red.
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