The best performing stock so far this year is a cosmetics company

Traders work at the Coty booth on the floor of the New York Stock Exchange.

Beauty company Coty is by far the best-performing stock in the S&P 500 so far this year.

Shares of the cosmetics distributor are up more than 100% in 2019, while the S&P 500 is up only 17%. Investors are betting on a major turnaround for Coty, under new management and finally recovering from its acquisition of P&G's beauty business. The stock fell 67% last year.

Coty, which distributes cosmetic brands like Opi, Covergirl and Sally Hansen, is in a transition period and many investors see its "steeply discounted" stock, trading around $13 a share, as an opportunity, said Jonathan Feeney, analyst with Consumer Edge Research.

Feeney attributes Coty's success to its "well regarded and now controlling owner," JAB Holdings. Private equity firm JAB, which also controls Dr. Pepper among others, took control of Coty in April, a move well respected by analysts on the Street.

"While worse than expected, U.S. mass beauty trends caught management by surprise -- management is making the necessary pivots," Feeney said.

JAB has the company braced for change. The firm brought in Coty's new CEO Pierre Laubies, who will unveil his turnaround strategy for Coty on July 1.

Source: CNBC

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