Foundation: 2013
Headquarter: NORTH CHICAGO (US)
Revenues: $54.318 BN
Effectives: 50,000
Stock Exchange: ABBV

The botox craze shows no signs of abating. Sales of botulinum toxin generated $5.673 billion in revenue for AbbVie in 2023. 

While therapeutic use of its product accounts for the largest share of sales ($2.991 billion), aesthetic use showed very strong growth in 2022 (up 17.2%) before stagnating last year (up 2.6%). This segment brought in $2.682 billion in 2023. While sales of Humira – a drug used in a number of treatments, including rheumatoid arthritis, which until 2022 was the drug generating the highest revenue worldwide – are collapsing (down 32.2% in 2023), AbbVie has found a serious growth driver in the aesthetics market.

In June 2019, AbbVie acquired Allergan, the maker of Botox, for $63 billion. No regrets there. Despite the emergence of competitors such as Galderma from Switzerland and Ipsen from France, the Botox brand continues to dominate by far the botulinum toxin market. AbbVie also markets injectable hyaluronic acid through its brand Juvéderm, world leader in the market segment generating revenue of $1.378 billion in 2023, and breast implants sold under the name Natrelle. In total, the aesthetics segment generated $5.294 billion for AbbVie in 2023, or around 10% of the company’s revenue. Most analysts recommend buying AbbVie stock, which has shot up more than 100% in the past five years.

Foundation: 1997
Headquarter: TEMPE, ARIZONA (US)
Revenues: $3.9 BN 
Effectives: 22,000
Stock Exchange: ALGN

Joseph M. Hogan. The name is not unfamiliar to Swiss investors. In 2008, the American businessman made headlines by becoming the first non-European to become CEO of ABB. During his five-year tenure at the helm of the Zurich-based group, the company’s revenues grew 25%. Since 2015, Joseph M. Hogan has taken into his own hands the destiny of the American smile expert, Align Technology. Founded in 1997 by two Stanford students, the orthodontics specialist started out developing clear plastic aligners and retainers to replace metal braces for patients with malocclusion (misaligned teeth).

On the market since 1999 under the name Invisalign, these devices have the advantages of being cheaper than braces, virtually invisible, and removable for meals and sports training. But the pandemic is what gave Align Technology’s sales a real boost. As video conferencing became an everyday reality, a perfect smile became a must. Between 2020 and 2021, the company’s annual revenue sky-rocketed 59.9%. Meanwhile, from January 2020 to January 2022, the share price soared by 135%. In the 26 years since the US Food and Drug Administration approved its Invisalign custommade systems, Align Technology has fitted nearly 17 million patients.

However, Invisalign was the only product of its kind on the market when it was launched. Since the expiry of its key patents, which began in 2017, Align has had to contend with growing competition. Well-established players such as Danaher Corporation and Sirona Dental Systems, as well as startups such as Candid and SmileDirectClub, are beginning to gnaw away at its market share.

But that is no cause for concern among analysts, and most recommend buying Align Technology shares. That is because the US firm has diversified into other areas. It has launched intraoral scanners (iTero), used for restorative and orthodontic solutions (digital imaging for crowns, veneers and implants), as well as orthodontic software. In 2023, teeth aligners accounted for just 80% of the company’s revenue. 

Foundation: 1882
Headquarter: HAMBURG (DE)
Revenues:  €9.447 BN 
Effectives: 22,000
Stock Exchange: BEI

Beiersdorf. You have to admit, the name of the German giant does not ring a bell for most consumers. But many use its beauty products, especially its iconic Nivea creams or Labello tubes of lip balm, with their distinctive blue packaging that lines countless supermarket shelves. However, with the advent of social media and the proliferation of beauty brands, these historic players – Nivea and Labello are over 100 years old – in recent years have come across as slightly outdated. But that was then. Since 2022, Beiersdorf Group has made a spectacular turnaround, launching a multitude of innovative products. For example, while the Nivea story began in 1911 with a single product – Eucerit skin cream sold in small round blue tins – the German brand now sells more than 500, including the successful Nivea Q10 (anti-wrinkle) and Cellular Filler ranges enriched with hyaluronic acid. And it’s working! Nivea brand sales soared 16.2% in 2023. For the group as a whole, after years of sluggish growth (revenue only rose by an average of just under 4% a year between 2012 and 2019), revenue shot up by a record 10.8% to €9.447 billion in 2023, up from €8.799 billion a year earlier.

Alongside the resurgence of its hugely mass-market brand Nivea, Beiersdorf Group is also benefiting from the boom in dermocosmetics, i.e., skincare recommended by dermatologists. Its Eucerin brand posted annual growth in sales of 22.1% between 2020 and 2023. The only minus is Zurich-based brand La Prairie, which is experiencing a rough patch, with revenue down 15.4% in 2023. “Beiersdorf has accomplished a lot in recent years, focusing on innovation and skincare,” says Paul Rouvière, an analyst at the investment bank Bryan, Garnier & Co. “And all that work is now paying off.” Since 1  January 2022, Beiersdorf’s share price has risen by almost 45%. Most analysts recommend buying the share, convinced that it will continue to climb.

Foundation: 2004
Headquarter: OAKLAND (US)
Revenues: $579 M
Effectives: 340
Stock Exchange: ELF

Founded just 20 years ago in 2004, the US firm e.l.f. Beauty (an acronym for eyes, lips and face) is no longer quite the pimply-faced teenager, despite being in the middle of a growth spurt. Set to report its 2024 financial year results in May, the company is expected to post revenue of between $980 million and $990 million, up 69% to 71% from its 2023 financial year. The e.l.f. share is following the same dizzying rise: between 1 January 2022 and 5 April 2024, its price soared by almost 390%. How did it do that? Virtually unknown in Europe and Asia, e.l.f. generates 88% of its revenue in the United States. But in the space of a few years, it has become the favourite cosmetics brand of American teens, according to a study conducted by the company itself. 

To achieve that status, the brand has focused on strong ethics, which appeals to Gen Z consumers. Its products have never been tested on animals and only contain chemicals reputed to be safe, having banned over 1,600 ingredients. E.l.f. also defends the planet (recycling, reduced packaging, etc.), campaigns for diversity, donates to nonprofits, and produces 75% of its products in Fair Trade Certified facilities. But in this day and age, it takes more than these good practices to guarantee success. And in the case of e.l.f., that "more" is Tik-Tok, the go-to social network of all of today’s youths.

In 2019, the company worked with advertising agency Movers+Shakers to launch the e.l.f. Cosmetics challenge. The game rules involved asking people to post a video on Tik-Tok, created specifically for the challenge, of themselves putting on make-up and dancing to music. The event resulted in more than 5 million user-generated videos, including from stars such as Lizzo, Ellen and Reese Witherspoon – who joined in, unpaid – and 7 billion views, making it the most viral campaign ever launched by a cosmetics brand in the United States. Since then, e.l.f. has achieved success on TikTok with multiple original campaigns.

And times have changed. These days, young people don’t just borrow their mum’s mascara before going out. Contemporary youths are self-taught experts, trained on Tik-Tok. And they buy their own products. To gain a place in the hearts of this audience, while going easy on their cash flow, as they tend to have less disposable income than their parents, the US firm has another edge. Unlike big groups that bank on "premiumisation", e.l.f. goes for affordability. Most analysts believe these ingredients combine into a winning formula and recommend buying the stock.

Foundation: 1946
Headquarter: NEW YORK (US)
Revenues: $15.91 BN 
Effectives: 60,000
Stock Exchange: EL

Not all big names in the beauty business enjoy the same radiance. While L’Oréal is on a record-breaking streak, US rival Estée Lauder reported in February that sales were down 7% in the second quarter of its 2024 financial year, which ended on 31 December. And this poor performance follows on directly from previous results. For its 2023 financial year that ended 30 June, Estée Lauder recorded a 10% drop in revenue to $15.91 billion compared with $17.74 billion a year earlier.

How did that happen? Sluggish sales in China, where economic recovery is proving slower than expected; the prolonged closure of the island province of Hainan, a duty-free haven and therefore Eldorado for cosmetics brands; and "headwind due to business disruptions in Israel and other parts of the Middle East," as the company put it. If Estée Lauder is going through tough times, it remains a solid group with outstanding brands.

The US company’s portfolio includes some powerhouse names in cosmetics, such as Estée Lauder, Aveda, Clinique, MAC and Jo Malone. The group also bolstered its positioning when it bought the Tom Ford brand in November 2022 for $2.3 billion. The acquisition not only gives the company a foot-hold in fashion, but also provides full access to the fast-growing brand Tom Ford Beauty.

Given these conditions, this lull for Estée Lauder could turn out to be an opportunity for investors. Year on year (5 April 2023 to 5 April 2024), the share price lost 40% of its value and could rebound on the back of a recovery in China. Of the 30 or so analysts who follow the stock, about 10 recommend buying Estée Lauder shares, while all the others recommend holding them.