Estee Lauder's (EL) Beauty Reimagined plan is expected to recover its earnings and increase its revenue compound annual growth rate by 4%, BofA Securities said in a Thursday note.

The company's new management is poised to attract more clients by "tripling innovation" that gets rolled out to markets in less than a year and launch into faster-growing channels earlier, while a 10% staff reduction will save $800 million to $1 billion in gross expenditures, analyst Ashley Wallace wrote.

The prestige beauty market has been impacted by a weak Chinese demand, but the "worst is now behind us" as China beauty demand sequentially rose in the last two quarters, and Q4 looks to be "stronger" again, Wallace said.

BofA Securities may re-rate the makeup products' manufacturer due to increased evidence of improving beauty market and stronger execution, the analyst said.

BofA Securities reinstated Estee Lauder's coverage with a buy rating and a $110 price target.

Shares of the company were up over 5% in recent Thursday trading.

Price: 91.67, Change: +5.06, Percent Change: +5.84