50% OFF
MarketBeat All Access
Get 30 days free. Save 50% your first year.
  •  days
  •  Hours
  •  Minutes
  •  Seconds
×
S&P 500   3,684.15 (+0.80%)
DOW   29,427.49 (+0.57%)
QQQ   276.91 (+0.93%)
AAPL   153.65 (+1.91%)
MSFT   239.93 (+1.04%)
META   137.54 (+0.86%)
GOOGL   99.27 (+1.12%)
AMZN   116.72 (+1.36%)
TSLA   287.06 (+4.00%)
NVDA   126.07 (+3.10%)
NIO   17.73 (+0.62%)
BABA   79.70 (+1.00%)
AMD   68.20 (+2.87%)
T   15.92 (+1.60%)
MU   49.98 (+2.25%)
CGC   2.86 (+4.38%)
F   12.09 (+0.83%)
GE   65.15 (+1.24%)
DIS   99.07 (+0.97%)
AMC   7.36 (+7.76%)
PYPL   86.74 (+2.94%)
PFE   44.32 (+1.12%)
NFLX   225.65 (+0.71%)
S&P 500   3,684.15 (+0.80%)
DOW   29,427.49 (+0.57%)
QQQ   276.91 (+0.93%)
AAPL   153.65 (+1.91%)
MSFT   239.93 (+1.04%)
META   137.54 (+0.86%)
GOOGL   99.27 (+1.12%)
AMZN   116.72 (+1.36%)
TSLA   287.06 (+4.00%)
NVDA   126.07 (+3.10%)
NIO   17.73 (+0.62%)
BABA   79.70 (+1.00%)
AMD   68.20 (+2.87%)
T   15.92 (+1.60%)
MU   49.98 (+2.25%)
CGC   2.86 (+4.38%)
F   12.09 (+0.83%)
GE   65.15 (+1.24%)
DIS   99.07 (+0.97%)
AMC   7.36 (+7.76%)
PYPL   86.74 (+2.94%)
PFE   44.32 (+1.12%)
NFLX   225.65 (+0.71%)
S&P 500   3,684.15 (+0.80%)
DOW   29,427.49 (+0.57%)
QQQ   276.91 (+0.93%)
AAPL   153.65 (+1.91%)
MSFT   239.93 (+1.04%)
META   137.54 (+0.86%)
GOOGL   99.27 (+1.12%)
AMZN   116.72 (+1.36%)
TSLA   287.06 (+4.00%)
NVDA   126.07 (+3.10%)
NIO   17.73 (+0.62%)
BABA   79.70 (+1.00%)
AMD   68.20 (+2.87%)
T   15.92 (+1.60%)
MU   49.98 (+2.25%)
CGC   2.86 (+4.38%)
F   12.09 (+0.83%)
GE   65.15 (+1.24%)
DIS   99.07 (+0.97%)
AMC   7.36 (+7.76%)
PYPL   86.74 (+2.94%)
PFE   44.32 (+1.12%)
NFLX   225.65 (+0.71%)
S&P 500   3,684.15 (+0.80%)
DOW   29,427.49 (+0.57%)
QQQ   276.91 (+0.93%)
AAPL   153.65 (+1.91%)
MSFT   239.93 (+1.04%)
META   137.54 (+0.86%)
GOOGL   99.27 (+1.12%)
AMZN   116.72 (+1.36%)
TSLA   287.06 (+4.00%)
NVDA   126.07 (+3.10%)
NIO   17.73 (+0.62%)
BABA   79.70 (+1.00%)
AMD   68.20 (+2.87%)
T   15.92 (+1.60%)
MU   49.98 (+2.25%)
CGC   2.86 (+4.38%)
F   12.09 (+0.83%)
GE   65.15 (+1.24%)
DIS   99.07 (+0.97%)
AMC   7.36 (+7.76%)
PYPL   86.74 (+2.94%)
PFE   44.32 (+1.12%)
NFLX   225.65 (+0.71%)

Helen Of Troy Is What We Fear Most About Q2 Earnings 

Helen Of Troy Is What We Fear Most About Q2 Earnings 

Helen Of Troy Beats Consensus But Guides Lower 

Helen of Troy (NASDAQ: HELE) had a strong quarter in Q2 but the results and guidance are what we fear most about the Q2 earnings reporting cycle. Not only were the results boosted by businesses and consumers trying to front-run inflation but the guidance is terrifying. Execs at Helen of Troy noted a marked shift in consumer and wholesale trends that led to a significant reduction in the guidance. Multiply these results across the broad market and what you’ll get is a massive reduction in the earnings outlook and one that could send the S&P 500 down another 10% to 20%. But back to Helen of Troy. 

“As noted in our April earnings call, we did see consumer buying patterns begin to change in the quarter, resulting in a slowdown in demand in some categories, partially offset by retailer orders intended to replenish prior consumption and/or raise holdings in anticipation of price increases,” said CEO Julien Mininberg. 

“Since our April earnings release, the macroeconomic outlook has changed significantly as consumers shift their buying patterns and adapt to a number of factors including the impact of inflation and interest rates rising more rapidly than expected. In response, many of our major retail customers announced actions to rebalance their inventory stemming from rapid revisions to their sales forecasts. We have lowered our sales and EPS outlooks for fiscal 2023, reflecting our current assessment of the impact of these new headwinds on our business.”

Helen Of Troy Cuts Guidance 

Helen Of Troy had a good quarter reporting $508.08 million in consolidated revenue. The revenue is down 6.1% from last year but last year was the peak of COVID spending so the comp is pretty tough. The is up 43.7% versus 2019, however, and beat the Marketbeat.com consensus by 715 basis points On an organic basis, sales are down 15.5% while on a core basis they’re down a smaller 2.5% with noted weakness in Health & Wellness and Beauty due to divestitures and a slowdown in spending. Home & Outdoors grew by 21%. 


Moving down to the margin the news is mixed. The company expanded the gross margin by a slim margin but the gains were more than offset by an increase in SG&A costs. SG&A costs increased by 610 basis points to nearly 35% which cut deeply into the results. The decline is attributed to share-based compensation, increased acquisition expense, and EPS costs but also to higher wages, marketing, shipping, and deleveraging of fixed expenses. The good news is that margin came in above expectations and resulted in adjusted earnings of $2.41versus $1.86 expected by the analysts. The bad news is that strength expected later in the year happened in FQ1 and the outlook is darkening. 

The company lowered its full-year guidance for revenue and earnings to a range well below the consensus. The revenue is expected to fall between $2.15 and $2.20 billion and earnings between $9.85 and $10.35 versus $2.37and $12.27. This suggests to us not only has business growth peaked but the pullback could be severe, more severe than the -20% EPS growth the guidance is now expecting. 

The Technical Outlook: Helen Of Troy In Downtrend 

Helen of Troy's share prices fell 10% in pre-market action following the release of the Q1 results. The move confirms the downtrend and resistance at the short-term moving average but may not results in a new low. Price action is still above the most recent low and the level may provide enough support to it up. If so, the stock may be at the bottom but it is too soon to tell. If not, this stock could fall down into the $120 range. 

Helen Of Troy Is What We Fear Most About Q2 Earnings 

Companies Mentioned in This Article

CompanyMarketRank™Current PricePrice ChangeDividend YieldP/E RatioConsensus RatingConsensus Price Target
Helen of Troy (HELE)
2.1879 of 5 stars
$105.91-0.4%N/A13.46Hold$214.67
Compare These Stocks  Add These Stocks to My Watchlist 

Should you invest $1,000 in Helen of Troy right now?

Before you consider Helen of Troy, you'll want to hear this.

MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Helen of Troy wasn't on the list.

While Helen of Troy currently has a "Hold" rating among analysts, top-rated analysts believe these five stocks are better buys.

View The Five Stocks Here

Thomas Hughes

About Thomas Hughes

Contributing Author: Technical and Fundamental Analysis

Thomas got his start with the markets while working as a Chef. In 2005 a chance invitation to attend the seminar “How To Buy And Sell Your Own Stocks” altered his worldview. Soon trading and stocks consumed his every waking moment to the point of excluding all else. Thomas now enjoys a much different lifestyle engaged in his true passion, uncovering great investments.
Contact Thomas Hughes via email at tmhughes.writeon@gmail.com.
Free Email Newsletter

Complete the form below to receive the latest headlines and analysts' recommendations for your stocks with our free daily email newsletter:

Most Read This Week

Recent Articles

Search Headlines:

Latest PodcastFed Raises Rates: 3 Stocks to Watch Newmont Mining, Walmart, AMC

Axel Merk, President and CIO of Merk Investments has three very different stocks he frames within the current market and economic conditions.

MarketBeat Resources

Premium Research Tools

MarketBeat All Access subscribers can access stock screeners, the Idea Engine, data export tools, research reports, and other premium tools.

Discover All Access

Market Data and Calendars

Looking for new stock ideas? Want to see which stocks are moving? View our full suite of financial calendars and market data tables, all for free.

View Market Data

Investing Education and Resources

Receive a free world-class investing education from MarketBeat. Learn about financial terms, types of investments, trading strategies and more.

Financial Terms
Details Here
MarketBeat - Stock Market News and Research Tools logo

MarketBeat empowers individual investors to make better trading decisions by providing real-time financial data and objective market analysis. Whether you’re looking for analyst ratings, corporate buybacks, dividends, earnings, economic reports, financials, insider trades, IPOs, SEC filings or stock splits, MarketBeat has the objective information you need to analyze any stock. Learn more about MarketBeat.

MarketBeat is accredited by the Better Business Bureau MarketBeat is rated as Great on TrustPilot

© American Consumer News, LLC dba MarketBeat® 2010-2022. All rights reserved.
326 E 8th St #105, Sioux Falls, SD 57103 | contact@marketbeat.com | (844) 978-6257
MarketBeat does not provide personalized financial advice and does not issue recommendations or offers to buy stock or sell any security.

Our Accessibility Statement | Terms of Service | Privacy Policy | Do Not Sell My Information | RSS Feeds

© 2022 Market data provided is at least 10-minutes delayed and hosted by Barchart Solutions. Information is provided 'as-is' and solely for informational purposes, not for trading purposes or advice, and is delayed. To see all exchange delays and terms of use please see Barchart's disclaimer.