Quarterly earnings results are a good time to check in on a company’s progress, especially compared to its peers in the same sector. Today we are looking at BeautyHealth (NASDAQ:SKIN) and the best and worst performers in the personal care industry.
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 12 personal care stocks we track reported a strong Q1. As a group, revenues beat analysts’ consensus estimates by 2.2% while next quarter’s revenue guidance was 5.7% below.
Luckily, personal care stocks have performed well with share prices up 16.3% on average since the latest earnings results.
BeautyHealth (NASDAQ:SKIN)
Operating in the emerging beauty health category, the appropriately named BeautyHealth (NASDAQ:SKIN) is a skincare company best known for its Hydrafacial product that cleanses and hydrates skin.
BeautyHealth reported revenues of $69.58 million, down 14.5% year on year. This print exceeded analysts’ expectations by 8.9%. Overall, it was a very strong quarter for the company with a solid beat of analysts’ gross margin estimates and an impressive beat of analysts’ EBITDA estimates.
“Our first quarter results reflect strong execution and continued momentum in our transformation strategy,” said CEO Marla Beck.
BeautyHealth achieved the biggest analyst estimates beat of the whole group. The stock is up 51.2% since reporting and currently trades at $1.86.
Is now the time to buy BeautyHealth? Access our full analysis of the earnings results here, it’s free.
Best Q1: The Honest Company (NASDAQ:HNST)
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 $97.25 million, up 12.8% year on year, outperforming analysts’ expectations by 5.7%. The business had an exceptional quarter with a solid beat of analysts’ EPS estimates and an impressive beat of analysts’ EBITDA estimates.
The Honest Company scored the fastest revenue growth among its peers. The market seems content with the results as the stock is up 2.3% since reporting. It currently trades at $4.90.
Is now the time to buy The Honest Company? Access our full analysis of the earnings results here, it’s free.
Weakest Q1: 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 $580.7 million, down 3.1% year on year, falling short of analysts’ expectations by 1.8%. It was a slower quarter as it posted a miss of analysts’ organic revenue estimates and full-year EBITDA guidance missing analysts’ expectations.
Edgewell Personal Care delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 19.6% since the results and currently trades at $24.15.
Read our full analysis of Edgewell Personal Care’s results here.
e.l.f. Beauty (NYSE:ELF)
Short for "eyes, lips, face", e.l.f. Beauty (NYSE:ELF) is a developer of high-quality beauty products at accessible price points.
e.l.f. Beauty reported revenues of $332.6 million, up 3.6% year on year. This print surpassed analysts’ expectations by 1.8%. It was a strong quarter as it also produced a solid beat of analysts’ EBITDA estimates and a decent beat of analysts’ EPS estimates.
The stock is up 37.2% since reporting and currently trades at $124.10.
Read our full, actionable report on e.l.f. Beauty here, it’s free.
Coty (NYSE:COTY)
With a portfolio boasting many household brands, Coty (NYSE:COTY) is a beauty products powerhouse spanning cosmetics, fragrances, and skincare.
Coty reported revenues of $1.30 billion, down 6.2% year on year. This number missed analysts’ expectations by 1%. More broadly, it was a mixed quarter as it also produced an impressive beat of analysts’ EBITDA estimates but a significant miss of analysts’ EPS estimates.
The stock is down 6.1% since reporting and currently trades at $4.85.
Read our full, actionable report on Coty here, it’s free.
Market Update
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 2024, a quarter in November) have propped up markets, 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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