On Thursday, beauty supply company Sally Beauty Co. (SBH - Free Report) reported its fiscal 2016 third quarter results, sending its stock sliding around 10% in midday trading.
The company reported adjusted diluted earnings per share of $0.47 (excluding one cent from non-recurring items), matching the Zacks Consensus Estimate and increasing 14.6% year-over-year. Total revenues, however, missed our consensus estimate of $1 billion for the quarter, coming in at $998.2 million, but grew 3.1% year-over-year.
Sally Beauty blames a weak performance in its North American business, as well as overall traffic and marketing. CEO Chris Brickman said in a statement that “Sally’s retail traffic is clearly taking longer to return to historical levels than we anticipated. We do believe there were a couple of tactical marketing changes in the quarter that negatively impacted traffic growth and we have moved quickly to address these issues.”
But going forward, the company “remain[s] optimistic that Sally can get back to steady, sequential sales improvement.”
While consolidated sales were a disappointment, same-store sales increased 1.3% during the third quarter, and inventory grew to $909.3 million as of June 30, 2016, up $34.7 million from the year ago inventory. Consolidated gross margin came in at 50%, up 30 bps from the prior year.
Sally Beauty is currently a #4 (Sell) on the Zacks Rank.
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On Thursday, beauty supply company Sally Beauty Co. (SBH - Free Report) reported its fiscal 2016 third quarter results, sending its stock sliding around 10% in midday trading.
The company reported adjusted diluted earnings per share of $0.47 (excluding one cent from non-recurring items), matching the Zacks Consensus Estimate and increasing 14.6% year-over-year. Total revenues, however, missed our consensus estimate of $1 billion for the quarter, coming in at $998.2 million, but grew 3.1% year-over-year.
Sally Beauty blames a weak performance in its North American business, as well as overall traffic and marketing. CEO Chris Brickman said in a statement that “Sally’s retail traffic is clearly taking longer to return to historical levels than we anticipated. We do believe there were a couple of tactical marketing changes in the quarter that negatively impacted traffic growth and we have moved quickly to address these issues.”
But going forward, the company “remain[s] optimistic that Sally can get back to steady, sequential sales improvement.”
While consolidated sales were a disappointment, same-store sales increased 1.3% during the third quarter, and inventory grew to $909.3 million as of June 30, 2016, up $34.7 million from the year ago inventory. Consolidated gross margin came in at 50%, up 30 bps from the prior year.
Sally Beauty is currently a #4 (Sell) on the Zacks Rank.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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