Avon: All Around the World

The cosmetics company's shares have risen steadily for two years. It's another example of how foreign sales feed the bottom line of otherwise struggling U.S. companies.

Avon Products (symbol AVP) calls itself the company for women, but if it meant only American women, that claim would ring hollow. The U.S. "is a long-term turnaround market," the company says, and it's still a weak link. But U.S. sales are just 28% of Avon's total, a sign that the company's direct-selling formula speaks many languages. Brazil, China, Colombia, Philippines, Russia and Turkey are all places where women now have more money to spend -- and where Avon reports sales growth that is far stronger than the 9% at home.

As a result, the cosmetics company's first-quarter results, released on May 2, both met analysts' expectations and set a favorable tone for the rest of the year and into 2008. Avon earned 34 cents a share, triple the 12 cents of a year ago, and most of that profit came outside the U.S. The dollar's weaker exchange rate, which means profits earned in other currencies become more valuable in dollars, added $3.8 million to earnings, or about a penny per share.

Subscribe to Kiplinger’s Personal Finance

Be a smarter, better informed investor.

Save up to 74%

Sign up for Kiplinger’s Free E-Newsletters

Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.

Profit and prosper with the best of expert advice - straight to your e-mail.

Sign up

To continue reading this article
please register for free

This is different from signing in to your print subscription

Why am I seeing this? Find out more here

Jeffrey R. Kosnett
Senior Editor, Kiplinger's Personal Finance
Kosnett is the editor of Kiplinger's Investing for Income and writes the "Cash in Hand" column for Kiplinger's Personal Finance. He is an income-investing expert who covers bonds, real estate investment trusts, oil and gas income deals, dividend stocks and anything else that pays interest and dividends. He joined Kiplinger in 1981 after six years in newspapers, including the Baltimore Sun. He is a 1976 journalism graduate from the Medill School at Northwestern University and completed an executive program at the Carnegie-Mellon University business school in 1978.