Personal Care Stocks Q3 Recap: Benchmarking Herbalife (NYSE:HLF)
Quarterly earnings results are a good time to check in on a company’s progress, especially compared to other peers in the same sector. Today we are looking at Herbalife (NYSE:HLF), and the best and worst performers in the personal care group.
Personal care products include lotions, fragrances, shampoos, cosmetics, and nutritional supplements, among others. While these 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. As with other consumer staples categories, personal care brands must exude quality and be priced optimally given the crowded competitive landscape. 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 14 personal care stocks we track reported a mixed Q3; on average, revenues beat analyst consensus estimates by 0.8% while next quarter's revenue guidance was 15.7% below consensus. Investors abandoned cash-burning companies to buy stocks with higher margins of safety, but personal care stocks held their ground better than others, with the share prices up 13% on average since the previous earnings results.
Herbalife (NYSE:HLF)
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 $1.28 billion, down 1.1% year on year, topping analyst expectations by 2.3%. It was a weak quarter for the company, with a miss of analysts' operating margin estimates.
“We remain on track to achieve year-over-year net sales growth in the fourth quarter as our trends continue to improve,” said Michael Johnson, Chairman and CEO of Herbalife.
The stock is down 10.9% since the results and currently trades at $12.41.
Read our full report on Herbalife here, it's free.
Best Q3: Olaplex (NASDAQ:OLPX)
A pioneer in the “bond building’ segment of hair care, Olaplex (NASDAQ:OLPX) offers products and treatments that focus on repairing the damage caused by traditional heat and chemical-based styling processes.
Olaplex reported revenues of $123.6 million, down 30% year on year, outperforming analyst expectations by 6.8%. It was an exceptional quarter for the company, with an impressive beat of analysts' earnings estimates.
The stock is up 51.4% since the results and currently trades at $2.09.
Is now the time to buy Olaplex? Access our full analysis of the earnings results here, it's free.
Weakest Q3: Nu Skin (NYSE:NUS)
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 $498.8 million, down 7.3% year on year, falling short of analyst expectations by 4.1%. It was a weak quarter for the company, with full-year revenue guidance missing analysts' expectations.
The stock is down 6.8% since the results and currently trades at $17.38.
Read our full analysis of Nu Skin's results here.
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 $534.1 million, down 0.5% year on year, in line with analyst expectations. It was a decent quarter for the company, with an impressive beat of analysts' EPS estimates.
The stock is up 6.9% since the results and currently trades at $37.5.
Read our full, actionable report on Edgewell Personal Care here, it's free.
Inter Parfums (NASDAQ:IPAR)
With licenses to produce colognes and perfumes under brands such as Kate Spade, Van Cleef & Arpels, and Abercrombie & Fitch, Inter Parfums (NASDAQ:IPAR) manufactures and distributes fragrances worldwide.
Inter Parfums reported revenues of $368 million, up 31.2% year on year, surpassing analyst expectations by 3.8%. It was a solid quarter for the company, with an impressive beat of analysts' earnings estimates.
The stock is up 6.8% since the results and currently trades at $136.26.
Read our full, actionable report on Inter Parfums here, it's free.
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The author has no position in any of the stocks mentioned
