Estee Lauder shares rise on 1st-quarter results, guidance

The New York company reported earnings fell 4 percent to 46 cents per share, a penny shy of analyst expectations, according to a Thomson Financial poll, as strong international sales were offset by weak U.S. results.

The company raised the lower end of its fiscal-year earnings forecast to $2.34 to $2.40 per share, up from February guidance of $2.28 to $2.40 per share. Analysts expect a profit of $2.36 per share.

Investors applauded the results, sending shares up $3.01, or 6.6 percent, to $48.41 during afternoon trading. The stock hit a 52-week high of $48.45 earlier. The stock had traded between $37.03 and $48.30 during the past 52 weeks.

Goldman Sachs analyst Andrew Sawyer said he was surprised by the "apparent relief rally."

"Relatively good sales results despite the soft U.S. cosmetics environment could be encouraging a group of secularly bullish investors in this stock," Sawyer wrote in note to clients. He suggested the buyers see a potential for "significant" profit margin recovery under the company's new chief operating officer.

Fabrizio Freda took over as the company's chief operating officer in March.

"We remain a bit more wary of the potential for a long-term margin recovery," Sawyer wrote.

He kept his "Neutral" rating on the stock but raised his price target by $1, to $48.