Looking back on personal care stocks’ Q3 earnings, we examine this quarter’s best and worst performers, including Edgewell Personal Care (NYSE:EPC) and its peers.
While personal care products products may seem more discretionary than food, consumers tend to maintain or even boost their spending on the category during tough times. This phenomenon is known as "the lipstick effect" by economists, which states that consumers still want some semblance of affordable luxuries like beauty and wellness when the economy is sputtering. Consumer tastes are constantly changing, and personal care companies are currently responding to the public’s increased desire for ethically produced goods by featuring natural ingredients in their products.
The 13 personal care stocks we track reported a satisfactory Q3. As a group, revenues beat analysts’ consensus estimates by 0.5% while next quarter’s revenue guidance was 10.6% below.
Luckily, personal care stocks have performed well with share prices up 14% on average since the latest earnings results.
Edgewell Personal Care (NYSE:EPC)
Boasting brands such as Banana Boat, Schick, and Skintimate, Edgewell Personal Care (NYSE:EPC) sells personal care products in the skin and sun care, shave, and feminine care categories.
Edgewell Personal Care reported revenues of $517.6 million, down 3.1% year on year. This print fell short of analysts’ expectations by 3.3%. Overall, it was a softer quarter for the company with a significant miss of analysts’ organic revenue and EBITDA estimates.
"For the fiscal year, we achieved slight organic net sales growth, meaningfully expanded adjusted gross margins and delivered double-digit adjusted earnings per share growth at constant currency for the second consecutive fiscal year. In the face of a heightened competitive landscape and an increasingly cautious consumer, we accelerated organic growth across our international businesses, introduced category-leading innovation in the US Sun Care category and deepened our participation across the men's and women's grooming segments. The strength of our business model was reflected in our healthy earnings growth, substantial cash flow generation and structural de-leveraging of the business," said Rod Little, Edgewell's President and Chief Executive Officer.
Edgewell Personal Care Total Revenue
Interestingly, the stock is up 1.1% since reporting and currently trades at $36.75.
Co-founded by actress Jessica Alba, The Honest Company (NASDAQ:HNST) sells diapers and wipes, skin care products, and household cleaning products.
The Honest Company reported revenues of $99.24 million, up 15.2% year on year, outperforming analysts’ expectations by 6.9%. The business had an incredible quarter with an impressive beat of analysts’ EPS estimates and a solid beat of analysts’ EBITDA estimates.
The Honest Company Total Revenue
The Honest Company scored the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 72.7% since reporting. It currently trades at $8.29.
With person-to-person marketing and sales rather than selling through retail stores, Nu Skin (NYSE:NUS) is a personal care and dietary supplements company that engages in direct selling.
Nu Skin reported revenues of $430.1 million, down 13.8% year on year, falling short of analysts’ expectations by 2.5%. It was a softer quarter as it posted a significant miss of analysts’ EBITDA and EPS estimates.
Interestingly, the stock is up 16.5% since the results and currently trades at $7.50.
With the first products sold out of the trunk of the founder’s car, Herbalife (NYSE:HLF) today offers a portfolio of shakes, supplements, personal care products, and weight management programs to help customers reach their nutritional and fitness goals.
Herbalife reported revenues of $1.24 billion, down 3.2% year on year. This number came in 1% below analysts' expectations. Zooming out, it was actually a very strong quarter as it recorded an impressive beat of analysts’ EPS estimates and a solid beat of analysts’ EBITDA estimates.
The stock is up 16.8% since reporting and currently trades at $7.99.
Rising to fame on TikTok because of its “bond building" hair products, Olaplex (NASDAQ:OLPX) offers products and treatments that repair the damage caused by traditional heat and chemical-based styling goods.
Olaplex reported revenues of $119.1 million, down 3.6% year on year. This result came in 5.9% below analysts' expectations. Overall, it was a softer quarter as it also recorded full-year revenue guidance missing analysts’ expectations.
Olaplex had the weakest performance against analyst estimates and weakest full-year guidance update among its peers. The stock is up 21.9% since reporting and currently trades at $2.17.
Thanks to the Fed’s rate hikes in 2022 and 2023, inflation has been on a steady path downward, easing back toward that 2% sweet spot. Fortunately (miraculously to some), all this tightening didn’t send the economy tumbling into a recession, so here we are, cautiously celebrating a soft landing. The cherry on top? Recent rate cuts (half a point in September, a quarter in November) have kept 2024 stock markets frothy, especially after Trump’s November win lit a fire under major indices and sent them to all-time highs. However, there's still plenty to ponder — tariffs, corporate tax cuts, and what 2025 might hold for the economy.
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