The Honest Company (NASDAQ:HNST) Q1 Earnings: Leading The Personal Care Pack
Let's dig into the relative performance of The Honest Company (NASDAQ:HNST) and its peers as we unravel the now-completed Q1 personal care earnings season.
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 mixed Q1; on average, revenues beat analyst consensus estimates by 1.1%. while next quarter's revenue guidance was 7.5% below consensus. Inflation progressed towards the Fed's 2% goal at the end of 2023, leading to strong stock market performance. The start of 2024 has been a bumpier ride, as the market switches between optimism and pessimism around rate cuts due to mixed inflation data, and personal care stocks have had a rough stretch, with share prices down 5.6% on average since the previous earnings results.
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 $86.22 million, up 3.4% year on year, topping analysts' expectations by 3.5%. It was a stunning quarter for the company, with an impressive beat of analysts' earnings estimates.
“Our first quarter results demonstrate our strong start to 2024. Our clear focus on profitability, delivering sales growth and achieving record gross margin of 37% as a public company is attributable to continued execution of our Transformation Pillars of Brand Maximization, Margin Enhancement and Operating Discipline,” said Chief Executive Officer, Carla Vernón.
The stock is down 11.9% since the results and currently trades at $2.59.
Is now the time to buy The Honest Company? Access our full analysis of the earnings results here, it's free.
Estée Lauder (NYSE:EL)
Named after its founder, who was an entrepreneurial woman from New York with a passion for skincare, Estée Lauder (NYSE:EL) is a one-stop beauty shop with products in skincare, fragrance, makeup, sun protection, and men’s grooming.
Estée Lauder reported revenues of $3.94 billion, up 5% year on year, in line with analysts' expectations. It was a solid quarter for the company, with an impressive beat of analysts' earnings estimates.
The stock is down 19.1% since the results and currently trades at $118.72.
Is now the time to buy Estée Lauder? Access our full analysis of the earnings results here, it's free.
Weakest Q1: Medifast (NYSE:MED)
Known for its Optavia program that combines portion-controlled meal replacements with coaching, Medifast (NYSE:MED) has a broad product portfolio of bars, snacks, drinks, and desserts for those looking to lose weight or consume healthier foods.
Medifast reported revenues of $174.7 million, down 49.9% year on year, in line with analysts' expectations. It was a weak quarter for the company, with revenue guidance for next quarter missing analysts' expectations.
Medifast had the slowest revenue growth in the group. The stock is down 41.6% since the results and currently trades at $20.74.
Read our full analysis of Medifast's results here.
USANA (NYSE:USNA)
Going to market with a direct selling model rather than through traditional retailers, USANA Health Sciences (NYSE:USNA) manufactures and sells nutritional, personal care, and skincare products.
USANA reported revenues of $227.8 million, down 8.3% year on year, in line with analysts' expectations. It was a mixed quarter for the company, with a solid beat of analysts' operating margin estimates but full-year revenue guidance missing analysts' expectations.
The stock is up 12.9% since the results and currently trades at $46.86.
Read our full, actionable report on USANA here, it's free.
Coty (NYSE:COTY)
With a portfolio boasting many household brands, Coty (NYSE:COTY) is a beauty products powerhouse with offerings in cosmetics, fragrances, and skincare.
Coty reported revenues of $1.39 billion, up 7.5% year on year, in line with analysts' expectations. It was a weaker quarter for the company, with a miss of analysts' operating margin and earnings estimates.
The stock is down 14.9% since the results and currently trades at $9.79.
Read our full, actionable report on Coty here, it's free.
Join Paid Stock Investor Research
Help us make StockStory more helpful to investors like yourself. Join our paid user research session and receive a $50 Amazon gift card for your opinions. Sign up here.
