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Things to Note Ahead of Helen of Troy's (HELE) Q1 Earnings

Zacks Equity Research
·3 min read

Helen of Troy Limited HELE is slated to release first-quarter fiscal 2021 results on Jul 9. This consumer products provider delivered a positive earnings surprise of 13.9% in the last reported quarter and has outperformed the consensus mark by 18.6%, on average, in the trailing four quarters.

The Zacks Consensus Estimate for earnings in the first quarter has gone up by 2.6% to $1.57 per share over the past seven days. However, this suggests a decline of 23.8% from the figure reported in the year-ago period. The consensus mark for revenues stands at $369 million, indicating a drop of 1.9% from the year-ago period’s reported figure.

Helen of Troy Limited Price and EPS Surprise

Helen of Troy Limited Price and EPS Surprise
Helen of Troy Limited Price and EPS Surprise

Helen of Troy Limited price-eps-surprise | Helen of Troy Limited Quote

Key Factors to Note

The company has been benefiting from the strength of its Leadership Brands, which account for a significant chunk of sales. Its constant investments in these brands have been delivering robust results. Management has been on track with investments in product launches, marketing efforts and e-commerce strategies for Leadership Brands. To this end, Helen of Troy acquired Drybar Products in January 2020, which is the company's eighth Leadership Brand and already yielding results. Apart from this, Helen of Troy’s continued investments in the digital platform to keep pace with the evolving consumer environment bode well.

However, in its fourth-quarter earnings call, management stated that Helen of Troy was seeing adverse impacts of various brick and mortar store closures, reduced store traffic and limited work hours in its stores. Moreover, the company had been witnessing supply-chain disruptions with some primary manufacturers. Management envisions the coronavirus pandemic to have affected its first-quarter sales. Apart from this, any rise in operating costs remains a threat to margins.

What the Zacks Model Unveils

Our proven model doesn’t conclusively predict an earnings beat for Helen of Troy this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Helen of Troy currently has a Zacks Rank #1 and an Earnings ESP of 0.00%. You can see the complete list of today’s Zacks #1 Rank stocks here.

Stocks With Favorable Combinations

Here are some companies you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat.

Colgate-Palmolive CL has an Earnings ESP of +1.85% and a Zacks Rank #2.

Kimberly-Clark KMB has an Earnings ESP of +1.78% and a Zacks Rank #2.

Procter & Gamble PG has an Earnings ESP of +1.51% and a Zacks Rank #2.

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