Looking back on personal care stocks’ Q2 earnings, we examine this quarter’s best and worst performers, including BeautyHealth (NASDAQ:SKIN) 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 slower Q2. As a group, revenues were in line with analysts’ consensus estimates while next quarter’s revenue guidance was 14.6% below.
Stocks, especially growth stocks with cash flows further into the future, had a good end of 2023. On the other hand, this year has seen more volatile stock market swings due to mixed inflation data, and personal care stocks have had a rough stretch. On average, share prices are down 7.1% since the latest earnings results.
Weakest Q2: 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 $90.6 million, down 22.9% year on year. This print fell short of analysts’ expectations by 8.1%. Overall, it was a disappointing quarter for the company with revenue guidance for next quarter missing analysts’ expectations.
BeautyHealth delivered the weakest performance against analyst estimates and weakest full-year guidance update of the whole group. Interestingly, the stock is up 15.5% since reporting and currently trades at $1.49.
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Best Q2: 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 $93.05 million, up 10.1% year on year, outperforming analysts’ expectations by 6.8%. The business had an exceptional quarter with an impressive beat of analysts’ earnings and gross margin estimates.
The Honest Company pulled off the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 22.6% since reporting. It currently trades at $3.98.
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 $212.9 million, down 10.6% year on year, falling short of analysts’ expectations by 3.7%. It was a disappointing quarter as it posted underwhelming earnings guidance for the full year and a miss of analysts’ earnings estimates.
As expected, the stock is down 16.4% since the results and currently trades at $38.31.
e.l.f. (NYSE:ELF) e.l.f. Beauty (NYSE:ELF), which stands for ‘eyes, lips, face’, offers high-quality beauty products at accessible price points.
e.l.f. reported revenues of $324.5 million, up 50% year on year. This number beat analysts’ expectations by 6.6%. It was a strong quarter as it also recorded an impressive beat of analysts’ earnings estimates and a decent beat of analysts’ operating margin estimates.
e.l.f. achieved the fastest revenue growth among its peers. The stock is down 38.8% since reporting and currently trades at $114.99.
Nature's Sunshine (NASDAQ:NATR) Started on a kitchen table in Utah, Nature’s Sunshine Products (NASDAQ:NATR) manufactures and sells nutritional and personal care products.
Nature's Sunshine reported revenues of $110.6 million, down 5.1% year on year. This print missed analysts’ expectations by 1.6%. It was a softer quarter as it also logged full-year revenue guidance missing analysts’ expectations.
The stock is down 5.4% since reporting and currently trades at $13.81.
This content was originally published on Stock Story
