Stock Story -
What Happened: Shares of beauty supply retailer Sally Beauty (NYSE:SBH) jumped 12.7% in the morning session after the company reported second quarter earnings results. Sally Beauty beat analysts' EPS expectations. Its revenue also outperformed Wall Street's estimates. The company maintained its previous full year guidance, calling for "net sales and comparable sales to be approximately flat compared to the prior year". Overall, this quarter was quite solid.
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What is the market telling us: Sally Beauty's shares are not very volatile than the market average and over the last year have had only 27 moves greater than 5%. Moves this big are very rare for Sally Beauty and that is indicating to us that this news had a significant impact on the market's perception of the business.
The biggest move we wrote about over the last year was 6 months ago, when the stock gained 7.6% on the news that the company reported first-quarter results with revenue slightly exceeding estimates, driven by a better-than-expected performance in its Beauty Systems Group, which contributed to outperformance in its same-store sales. EPS also beat. For the full year, the company maintained its sales projections, with growth expected to be flat, "reflecting growth from the company's strategic initiatives, offset by anticipated pressure on consumer spending." Overall, it was a decent but mixed quarter for the company.
Sally Beauty is down 22.6% since the beginning of the year, and at $10.27 per share it is trading 25.6% below its 52-week high of $13.80 from February 2024. Investors who bought $1,000 worth of Sally Beauty's shares 5 years ago would now be looking at an investment worth $745.47.
