Looking back on personal care stocks' Q1 earnings, we examine this quarter's best and worst performers, including USANA (NYSE:USNA) 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 mixed Q1; on average, revenues beat analyst consensus estimates by 1.1%. while next quarter's revenue guidance was 7.5% below consensus. Stocks, especially growth stocks where cash flows further in the future are more important to the story, had a good end of 2023. But the beginning of 2024 has seen more volatile stock performance due to mixed inflation data, and personal care stocks have had a rough stretch, with share prices down 5.2% on average since the previous earnings results.
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. Overall, it was an ok quarter for the company with a solid beat of analysts' earnings estimates but full-year revenue guidance missing analysts' expectations.
“Our top line results during the first quarter were driven by a successful sales incentive in mainland China, which helped counter the seasonal slowdown that we experience during the Lunar New Year holiday,” said Jim Brown, President and Chief Executive Officer.
The stock is up 9% since reporting and currently trades at $45.23.
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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, outperforming analysts' expectations by 3.5%. It was a stunning quarter for the company with an impressive beat of analysts' earnings estimates.
The market seems happy with the results as the stock is up 14.6% since reporting. It currently trades at $3.37.
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. As expected, the stock is down 47.5% since the results and currently trades at $18.63.
Herbalife (NYSE: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 $1.26 billion, flat year on year, in line with analysts' expectations. Overall, it was an ok quarter for the company with an impressive beat of analysts' earnings estimates but a miss of analysts' organic revenue growth estimates.
The stock is up 29.6% since reporting and currently trades at $11.26.
Nu Skin (NYSE: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 $417.3 million, down 13.3% year on year, falling short of analysts' expectations by 3.5%. Overall, it was a slower quarter for the company with full-year revenue guidance missing analysts' expectations and a miss of analysts' gross margin estimates.
Nu Skin had the weakest performance against analyst estimates among its peers. The stock is down 15.5% since reporting and currently trades at $10.49.
This content was originally published on Stock Story
