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Sally Beauty (SBH) to Report Q4 Earnings: What's in Store?

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Sally Beauty Holdings, Inc. (SBH - Free Report) is likely to register an improvement in the top line, when it reports fourth-quarter fiscal 2020 numbers on Nov 12. The Zacks Consensus Estimate for revenues is pegged at $983.13 million, which indicates an increase of 1.8% from the prior-year quarter’s reported figure.

However, the company’s bottom line is expected to decline year over year. Though the Zacks Consensus Estimate for fiscal fourth-quarter earnings has moved up by a cent in the past seven days to 56 cents per share, it suggests a 3.5% drop from the year-ago quarter’s reported figure. Notably, this international specialty retailer and distributor of professional beauty supplies has a trailing four-quarter negative earnings surprise of 43%, on average.

Sally Beauty Holdings, Inc. Price and EPS Surprise

 

Sally Beauty Holdings, Inc. Price and EPS Surprise

Sally Beauty Holdings, Inc. price-eps-surprise | Sally Beauty Holdings, Inc. Quote

 

Factors to Note

Sally Beauty is witnessing increased consumer demand on digital platforms amid the coronavirus pandemic. In this regard, the company is undertaking a number of efforts to enhance its digital space like expanding its retail beauty offerings online and augmenting its delivery options. In its last earnings call, management stated that with restrictions to check the coronavirus outbreak being lifted, Sally Beauty has reopened almost all its stores.

However, the company is grappling with higher SG&A expenses as a percentage of sales. Also, the impact of sluggish demand in the Sally Beauty Supply segment is hurting performance in the past few quarters. Apart from these, adverse impacts of unfavorable foreign currency fluctuation cannot be ignored.

What the Zacks Model Unveils

Our proven model doesn’t conclusively predict an earnings beat for Sally Beauty this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Sally Beauty carries a Zacks Rank #3 and an Earnings ESP of -5.83%.

Stocks With Favorable Combination

Here are some companies that you may want to consider as our model shows that these also have the right combination of elements to post an earnings beat.

Best Buy (BBY - Free Report) currently has an Earnings ESP of +14.92% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

DICK’S Sporting Goods (DKS - Free Report) currently has an Earnings ESP of +18.57% and a Zacks Rank #3.

American Eagle Outfitters (AEO - Free Report) currently has an Earnings ESP of +10.27% and a Zacks Rank #3.

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