Spotting Winners: Edgewell Personal Care (NYSE:EPC) And Personal Care Stocks In Q2

Let’s dig into the relative performance of Edgewell Personal Care (NYSE:EPC) and its peers as we unravel the now-completed Q2 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 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 those trading at higher multiples--had a strong end of 2023, but this year has seen periods of volatility. Mixed signals about inflation have led to uncertainty around rate cuts, and while some personal care stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 2.6% since the latest earnings results.

Edgewell Personal Care (NYSE:EPC)

Boasting brands such as Banana Boat, Schick, and Skintimate, Edgewell Personal Care (NYSE:EPC) sells personal care products in the skin and sun care, shave, and feminine care categories.

Edgewell Personal Care reported revenues of $647.8 million, flat year on year. This print was in line with analysts’ expectations, but overall, it was a mixed quarter for the company with a solid beat of analysts’ earnings estimates but a miss of analysts’ organic revenue growth estimates.

"Our third quarter results reflected robust gross margin accretion leading to substantial adjusted EBITDA and earnings per share growth. Amidst a competitive and dynamic market landscape, organic net sales growth featured continued strength in our Right-to-Win portfolio, propelled by our industry-leading Sun Care and Grooming businesses. Our international businesses sustained their momentum, achieving significant growth through a balanced mix of pricing and volume improvements. " stated Rod Little, Edgewell's President and Chief Executive Officer.

Interestingly, the stock is up 5.4% since reporting and currently trades at $39.66.

Is now the time to buy Edgewell Personal Care? Access our full analysis of the earnings results here, it’s free.

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%. It was a very strong quarter for the company with an impressive beat of analysts’ gross margin estimates and a solid beat of analysts’ earnings estimates.

The Honest Company delivered the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 35.6% since reporting. It currently trades at $4.40.

Is now the time to buy The Honest Company? Access our full analysis of the earnings results here, it’s free.

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, falling short of analysts’ expectations by 8.1%. It was a weak quarter for the company with revenue guidance for next quarter missing analysts’ expectations.

BeautyHealth posted the weakest performance against analyst estimates and weakest full-year guidance update in the group. Interestingly, the stock is up 24.5% since the results and currently trades at $1.61.

Read our full analysis of BeautyHealth’s results here.

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 $1.36 billion, flat year on year, in line with analysts’ expectations. Taking a step back, it was a weaker quarter for the company with a miss of analysts’ earnings estimates and underwhelming earnings guidance for the full year.

The stock is flat since reporting and currently trades at $9.44.

Read our full, actionable report on Coty here, it’s free.

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 $168.6 million, down 43.1% year on year, falling short of analysts’ expectations by 3.2%. Zooming out, it was a weak quarter for the company with revenue guidance for next quarter missing analysts’ expectations.

Medifast had the slowest revenue growth among its peers. The stock is down 14.4% since reporting and currently trades at $17.94.

Read our full, actionable report on Medifast here, it’s free.

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