PARIS, France — L'Oréal's shares rose sharply on Wednesday after the cosmetics and fashion group reported higher third-quarter sales, with turnover driven by booming demand in Asia.

L'Oréal shares were up 5.9 percent in early trading, one of the best performers on European markets. The stock has risen nearly 10 percent so far in 2018.

Late on Tuesday, L'Oréal posted revenue of €6.47 billion ($7.3 billion), up 6.2 percent from a year earlier and rising 7.5 percent on a like-for-like (LFL) basis, which strips out currency swings and the effect of acquisitions.

"Outstanding Q3 LFL top-line growth was ahead of the elevated levels of H1 and consensus expectations," Bernstein analyst Andrew Wood said in a note.

"L'Oréal's stock has been lacklustre in recent weeks, giving up some year-to-date gains, as investors worried about slowing top-line momentum, but the strong Q3 should drive a good, positive stock reaction," he added.

A particularly strong performance in the luxury division, which houses Yves Saint Laurent make-up and perfumes and brands such as Clarisonic, also lifted L'Oréal's overall revenue.

Rivals more squarely focused on the luxury segment like US-based Estée Lauder have also been performing well.

L'Oréal has been struggling, however, to counter more sluggish growth in its consumer products division, with sales coming in a little below forecasts and matching the lacklustre 2.3 percent like-for-like growth of the second quarter.

Nevertheless, analysts gave a positive reaction with Investec upgrading its rating on L'Oréal to "buy" from "hold".

The Bettencourt Meyers family owns 33 percent of L'Oréal and Swiss company Nestlé has a 23 percent stake.

By Sudip Kar-Gupta; editors: Inti Landauro and David Evans

Related Articles:

[ L'Oréal Makes a Splash on the Seine ]

[ Luxury Cosmetics and Chinese Demand Drive Sales Bounce at L'Oréal ]