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Helen Of Troy Limited (HELE)
NASDAQ:HELE
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Helen Of Troy
(NASDAQ:HELE)
73Outperform
Positive Factors
Brand Expansion
Brand-building initiatives are already showing positives, with brands like Osprey and OXO expanding into adjacent categories and winning increased shelf space and distribution.
Strategic Acquisitions
The recent acquisition of Olive & June, a fast-growing nail brand company, is immediately accretive to earnings and has a lot of growth opportunities left.
Negative Factors
Competition and Demand
Full year FY24 EPS is expected towards the lower end of management's $8.70-9.20 guidance range driven by a discretionary rebound that has been softer than anticipated and heightened competition.
Market Challenges
The weak cough/cold season led to a $10M headwind in 3Q and anticipated $15M-$20M in 4Q.
Helen Of Troy (HELE) vs. S&P 500 (SPY)
Market Cap
$1.26B
Dividend YieldN/A
Average Volume (3M)413.36K
Price to Earnings (P/E)11.1
Beta (1Y)0.95
Revenue Growth-4.36%
EPS Growth-26.64%
CountryUS
Employees1,927
SectorConsumer Cyclical
Sector Strength49
IndustryConsumer Products - Household & Personal
Share Statistics
EPS (TTM)4.96
Shares Outstanding22,855,740
10 Day Avg. Volume449,205
30 Day Avg. Volume413,355
Financial Highlights & Ratios
PEG Ratio2.25
Price to Book (P/B)N/A
Price to Sales (P/S)0.68
Price to Cash Flow (P/CF)39.00
P/FCF Ratio1697.10
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$80.00Price Target Upside49.93% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering3
Helen Of Troy Business Overview & Revenue Model
Company DescriptionHelen Of Troy Limited (HELE) is a global consumer products company that offers a diverse portfolio of well-recognized and widely trusted brands. Operating through multiple segments, the company specializes in health and home products, beauty products, and housewares. Its core products include personal care items, small household appliances, kitchenware, and health and wellness solutions. Some of the renowned brands under its umbrella are OXO, Hydro Flask, Braun, Vicks, Honeywell, and PUR.
How the Company Makes MoneyHelen Of Troy makes money primarily through the design, development, and distribution of a wide range of consumer products. The company's revenue streams are mainly categorized into its three operating segments: Housewares, Health & Home, and Beauty. The Housewares segment includes sales from kitchen tools, gadgets, and storage solutions, primarily through the OXO and Hydro Flask brands. The Health & Home segment generates revenue from sales of healthcare and home environment products, such as thermometers, humidifiers, and air purifiers, under brands like Braun, Vicks, and Honeywell. The Beauty segment consists of sales from hair care, grooming, and personal wellness products, including brands like Revlon and Hot Tools. Helen Of Troy employs a multi-channel distribution strategy, selling products through retail stores, online platforms, and direct-to-consumer channels. Key partnerships with major retailers and online marketplaces significantly contribute to its earnings.
Helen Of Troy Financial Statement Overview
Summary
Helen Of Troy demonstrates solid profitability and cash flow metrics, with a strong emphasis on improving financial stability by reducing debt. However, declining revenue and net income trends present concerns for future growth. The company should focus on enhancing revenue streams to strengthen its financial position further.Income Statement
The company's gross profit margin and EBIT margin are healthy, but there has been a decline in revenue and net income over recent periods. The TTM (Trailing-Twelve-Months) revenue is lower than previous years, indicating potential challenges in maintaining growth.70
Positive
Balance Sheet
The balance sheet shows a solid equity base with a manageable debt-to-equity ratio. The company has improved its debt levels significantly over the TTM period, enhancing financial stability. However, liquidity remains a concern with relatively low cash reserves.75
Positive
Cash Flow
Operating cash flow remains strong, and the company has managed to improve free cash flow significantly in the TTM period. The free cash flow to net income ratio is robust, indicating efficient cash conversion from earnings.80
Positive
| Breakdown | |||||
| TTM | Mar 2024 | Mar 2023 | Mar 2022 | Mar 2021 | Mar 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 1.91B | 2.01B | 2.07B | 2.22B | 2.10B | 1.71B | Gross Profit |
| 913.60M | 948.66M | 899.35M | 953.19M | 927.30M | 734.47M | EBIT |
| 212.75M | 260.59M | 211.79M | 272.55M | 281.49M | 178.25M | EBITDA |
| 259.83M | 313.61M | 266.28M | 313.46M | 322.28M | 217.62M | Net Income Common Stockholders |
| 115.57M | 168.59M | 143.27M | 223.76M | 253.95M | 152.33M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 40.80M | 18.50M | 29.07M | 33.38M | 45.12M | 24.47M | Total Assets |
| 2.97B | 2.84B | 2.91B | 2.82B | 2.26B | 1.90B | Total Debt |
| 49.46M | 702.93M | 977.08M | 856.96M | 381.98M | 380.17M | Net Debt |
| 8.66M | 684.43M | 948.01M | 823.58M | 336.86M | 355.70M | Total Liabilities |
| 1.34B | 1.20B | 1.42B | 1.50B | 1.02B | 742.16M | Stockholders Equity |
| 1.63B | 1.64B | 1.49B | 1.33B | 1.24B | 1.16B |
| Cash Flow | Free Cash Flow | ||||
| 122.73M | 269.42M | 33.38M | 62.78M | 215.44M | 253.53M | Operating Cash Flow |
| 151.84M | 306.07M | 208.24M | 140.82M | 314.11M | 271.29M | Investing Cash Flow |
| -32.14M | 5.45M | -319.33M | -438.91M | -98.67M | -273.62M | Financing Cash Flow |
| -104.15M | -322.09M | 106.78M | 286.35M | -194.78M | 14.92M |
Helen Of Troy Technical Analysis
Negative
53.36
Price Trends
59.50
Negative
63.32
Negative
67.00
Negative
Market Momentum
-1.49
Positive
36.15
Neutral
40.32
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HELE, the sentiment is Negative. The current price of 53.36 is below the 20-day moving average (MA) of 56.34, below the 50-day MA of 59.50, and below the 200-day MA of 67.00, indicating a bearish trend. The MACD of -1.49 indicates Positive momentum. The RSI at 36.15 is Neutral, neither overbought nor oversold. The STOCH value of 40.32 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HELE.
Helen Of Troy Risk Analysis
Helen Of Troy disclosed 28 risk factors in its most recent earnings report. Helen Of Troy reported the most risks in the “Legal & Regulatory” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Helen Of Troy Peers Comparison
Overall Rating
UnderperformOutperform
Sector (60)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $405.94B | 28.08 | 31.05% | 2.28% | 0.49% | 5.02% | |
78 Outperform | $79.12B | 27.57 | 704.02% | 2.05% | 3.30% | 26.83% | |
74 Outperform | $27.84B | 47.38 | 14.25% | 1.02% | 4.08% | -22.34% | |
73 Outperform | $1.26B | 11.13 | 7.19% | ― | -4.36% | -26.64% | |
60 Neutral | $12.39B | 10.47 | 1.07% | 3.58% | 1.64% | -18.33% | |
50 Neutral | $25.91B | 147.29 | -14.17% | 2.80% | 0.07% | -249.21% | |
48 Neutral | $2.80B | ― | -7.37% | 4.16% | -6.77% | 44.59% |
* Consumer Cyclical Sector Average
Performance Comparison
HELE
Helen Of Troy
53.36
-66.07
-55.32%
CHD
Church & Dwight
112.19
8.82
8.53%
CL
Colgate-Palmolive
94.10
7.23
8.32%
EL
The Estée Lauder Companies
69.60
-79.12
-53.20%
NWL
Newell Brands
6.54
-0.84
-11.38%
PG
Procter & Gamble
173.12
15.09
9.55%
Helen Of Troy Earnings Call Summary
Earnings Call Date: Jan 8, 2025 | % Change Since: -10.00% | Next Earnings Date: Apr 23, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted significant progress in strategic initiatives, strong performance in certain segments, and successful acquisitions, but these were balanced by challenges in the Beauty & Wellness segment and external factors like low illness rates and retailer bankruptcies.Highlights
Home & Outdoor Segment Growth
Sales in the Home & Outdoor segment increased by 4.3%, driven by growth in all three brands and strength in international markets.
Successful Distribution Gains
U.S. weighted distribution grew by 11% year-over-year, with significant distribution gains in international markets through new channels and partnerships.
Acquisition of Olive & June
The acquisition of Olive & June was completed, which is immediately accretive to revenue growth rate, gross profit margin, and expected ongoing adjusted EPS growth rate.
Project Pegasus Progress
Lower year-over-year product and commodity costs positively impacted gross profit margin, providing fuel for reinvestment in brands and business.
Improved Gross Profit Margin
Consolidated gross profit margin increased by 90 basis points to 48.9%, driven by favorable inventory obsolescence expense and lower commodity and product costs.
Lowlights
Beauty & Wellness Segment Decline
The Beauty & Wellness segment saw a decline, unfavorably impacted by a weaker-than-expected winter and illness season, affecting sales.
Weak Cough, Cold, and Flu Season
The low global illness rates impacted wellness-related sales, with U.S. illness rates at an 8-year low, excluding the COVID anomaly year.
Retailer Bankruptcy Impact
The bankruptcy of retailers, including the Container Store, impacted sales, particularly affecting the OXO brand.
Higher Inventory Levels
Inventory levels increased due to strategic builds to capture potential demand and defer potential tariff impacts, leading to higher carrying costs.
Company Guidance
During the third quarter earnings call for Helen of Troy Limited (symbol: HELE), the company's executives discussed their financial performance and provided guidance for the remainder of fiscal 2025. Despite a challenging consumer environment, the company reported net sales in line with their outlook, with Home & Outdoor sales increasing by 4.3%, while Beauty & Wellness faced a decline due to a weaker-than-expected illness season. Key metrics highlighted include a consolidated net sales decline of 3.4%, a gross profit margin increase of 90 basis points to 48.9%, and an adjusted operating margin improvement of 30 basis points to 16.6%. The company revised its full-year guidance, anticipating net sales between $1.888 billion and $1.913 billion, with adjusted EPS expected to range from $7.15 to $7.40. Additionally, the acquisition of Olive & June is projected to be immediately accretive, contributing $17 million to $18 million in net sales and $0.05 to $0.07 in adjusted EPS for the partial fourth quarter period. The company anticipates ending the fiscal year with a net leverage ratio between 2.85x and 2.75x, while continuing to focus on strategic initiatives, including Project Pegasus and diversification of their supplier base.Helen Of Troy Corporate Events
M&A TransactionsBusiness Operations and Strategy
Helen of Troy Expands with Olive & June Acquisition
Positive
Dec 16, 2024
Helen of Troy Limited has successfully completed the acquisition of Olive & June, an innovative omni-channel nail care brand known for its DIY nail care products. This acquisition, funded by a revolving credit agreement of $235 million, is expected to enhance Helen of Troy’s beauty portfolio and is projected to be immediately accretive to the company’s revenue growth, gross profit margin, and other key financial metrics, aligning with its strategic goals and expanding its presence beyond the hair category.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.