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Prestige Consumer (PBH) Rises on Q3 Earnings Beat, Raised View
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Shares of Prestige Consumer Healthcare Inc. (PBH - Free Report) rose almost 5% on Feb 3 as the company raised its fiscal 2022 guidance on posting solid third-quarter fiscal 2022 results. During the quarter, both the top and bottom lines beat the Zacks Consensus Estimate and grew year over year. This marks the company’s 12th straight quarter of a revenue beat.
The company’s third quarter continued the solid momentum witnessed in the first half. Prestige Consumer benefited from its vast brand portfolio, which helped it register a double-digit revenue increase in several areas, including the greater-than-anticipated recovery in pandemic-impacted areas (like cough & cold), solid international revenues (particularly due to Australia) and the overall strength in domestic consumer healthcare demand. Encouragingly, management raised its fiscal 2022 guidance.
Quarter in Detail
The company posted earnings of 99 cents per share, which surpassed the Zacks Consensus Estimate of 89 cents. The bottom line advanced 22.2% year over year.
Prestige Consumer Healthcare Inc. Price, Consensus and EPS Surprise
Total revenues grew 14.9% to $274.5 million and beat the Zacks Consensus Estimate of $260 million. Excluding currency impacts and contributions from the Akorn buyout, revenues rose 8.8%. Revenues were backed by the strength in key brands as well as improved demand across certain categories, brands and channels that were hurt by the pandemic in the year-ago period (such as cold & cough products).
Gross profit was $155.1 million, up from $138.9 million reported in the year-ago period. Operating income of $82.6 million increased from $73.4 million in the same period last year.
Segmental Performance
Revenues in the North American OTC Healthcare segment were $240.9 million, up 14.4% year over year, driven by the solid performance in the majority of its key brands and favorable demand in certain categories (like cough & cold and motion sickness), which were earlier impacted by COVID-19. Gains of about $14 million from the Akorn acquisition also aided segmental growth.
Revenues in the International OTC Healthcare segment were $33.6 million, up 19.3% from the year-ago quarter’s figure of $28.2 million. The uptick can be attributed to higher consumer activity in Australia, which led to a significant spike in demand for Hydralyte and other pandemic-impacted brands.
Image Source: Zacks Investment Research
Financial Updates
Prestige Consumer exited the quarter with cash and cash equivalents of about $21 million, long-term debt (net) of $1,530.3 million and total shareholders’ equity of $1,518.3 million.
Net cash provided by operating activities in the quarter under review was $66.3 million. Adjusted free cash flow for the same time frame was $64.1 million. Adjusted free cash flow is anticipated at $250 million or more for fiscal 2022, up from $245 million or more guided earlier. As of Dec 31, 2021, the company’s net debt position was roughly $1.5 billion. Robust free cash flow helped the company to lower its debt load by $70 million during the third quarter.
Guidance
Driven by impressive quarterly results and anticipation of the continued recovery of certain pandemic-impacted categories like cough & cold (as seen in the third quarter), management raised its fiscal 2022 view. PBH’s solid brand portfolio, strict capital deployment and strong financial profile keep it well-placed for top and bottom-line growth in fiscal 2023.
For fiscal 2022, the company anticipates revenues in the range of $1,075-$1,080 million, up from the earlier-mentioned view of $1,050-$1,060 million. Organic growth is projected at 9% now compared with the previous guidance of 7%.
Finally, the company envisions adjusted earnings per share (EPS) of $4-$4.04, up from the $3.93-$3.98 range mentioned before. In fiscal 2021, Prestige Consumer’s top and bottom lines were $943.4 million and $3.24 per share, respectively.
This Zacks Rank #2 (Buy) stock has rallied 15.3% in the past three months against the industry’s decline of 26.8%.
The Zacks Consensus Estimate for Funko’s 2022 sales and EPS suggests growth of 8.7% and 9.5%, respectively, from the year-ago reported figure. FNKO has a trailing four-quarter earnings surprise of 110.7%, on average.
Guess?, which designs, markets, distributes and licenses lifestyle collections of apparel and accessories, carries a Zacks Rank #2 at present. Shares of Guess? have moved up 3.5% in the past six months.
The Zacks Consensus Estimate for Guess?’s fiscal 2022 sales and EPS suggests growth of 6% and 11.7%, respectively, from the year-ago reported number. GES has a trailing four-quarter earnings surprise of 97%, on average.
Gildan Activewear, which manufactures and sells various apparel products, carries a Zacks Rank #2 at present. It has a trailing four-quarter earnings surprise of 9.7%, on average. Shares of Gildan Activewear have moved up 14.8% in the past six months.
The Zacks Consensus Estimate for Gildan Activewear’s 2022 sales and EPS suggests growth of 8.2% and 9.4%, respectively, from the year-ago reported figure. GIL has a trailing four-quarter earnings surprise of around 85%, on average.
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Prestige Consumer (PBH) Rises on Q3 Earnings Beat, Raised View
Shares of Prestige Consumer Healthcare Inc. (PBH - Free Report) rose almost 5% on Feb 3 as the company raised its fiscal 2022 guidance on posting solid third-quarter fiscal 2022 results. During the quarter, both the top and bottom lines beat the Zacks Consensus Estimate and grew year over year. This marks the company’s 12th straight quarter of a revenue beat.
The company’s third quarter continued the solid momentum witnessed in the first half. Prestige Consumer benefited from its vast brand portfolio, which helped it register a double-digit revenue increase in several areas, including the greater-than-anticipated recovery in pandemic-impacted areas (like cough & cold), solid international revenues (particularly due to Australia) and the overall strength in domestic consumer healthcare demand. Encouragingly, management raised its fiscal 2022 guidance.
Quarter in Detail
The company posted earnings of 99 cents per share, which surpassed the Zacks Consensus Estimate of 89 cents. The bottom line advanced 22.2% year over year.
Prestige Consumer Healthcare Inc. Price, Consensus and EPS Surprise
Prestige Consumer Healthcare Inc. price-consensus-eps-surprise-chart | Prestige Consumer Healthcare Inc. Quote
Total revenues grew 14.9% to $274.5 million and beat the Zacks Consensus Estimate of $260 million. Excluding currency impacts and contributions from the Akorn buyout, revenues rose 8.8%. Revenues were backed by the strength in key brands as well as improved demand across certain categories, brands and channels that were hurt by the pandemic in the year-ago period (such as cold & cough products).
Gross profit was $155.1 million, up from $138.9 million reported in the year-ago period. Operating income of $82.6 million increased from $73.4 million in the same period last year.
Segmental Performance
Revenues in the North American OTC Healthcare segment were $240.9 million, up 14.4% year over year, driven by the solid performance in the majority of its key brands and favorable demand in certain categories (like cough & cold and motion sickness), which were earlier impacted by COVID-19. Gains of about $14 million from the Akorn acquisition also aided segmental growth.
Revenues in the International OTC Healthcare segment were $33.6 million, up 19.3% from the year-ago quarter’s figure of $28.2 million. The uptick can be attributed to higher consumer activity in Australia, which led to a significant spike in demand for Hydralyte and other pandemic-impacted brands.
Financial Updates
Prestige Consumer exited the quarter with cash and cash equivalents of about $21 million, long-term debt (net) of $1,530.3 million and total shareholders’ equity of $1,518.3 million.
Net cash provided by operating activities in the quarter under review was $66.3 million. Adjusted free cash flow for the same time frame was $64.1 million. Adjusted free cash flow is anticipated at $250 million or more for fiscal 2022, up from $245 million or more guided earlier. As of Dec 31, 2021, the company’s net debt position was roughly $1.5 billion. Robust free cash flow helped the company to lower its debt load by $70 million during the third quarter.
Guidance
Driven by impressive quarterly results and anticipation of the continued recovery of certain pandemic-impacted categories like cough & cold (as seen in the third quarter), management raised its fiscal 2022 view. PBH’s solid brand portfolio, strict capital deployment and strong financial profile keep it well-placed for top and bottom-line growth in fiscal 2023.
For fiscal 2022, the company anticipates revenues in the range of $1,075-$1,080 million, up from the earlier-mentioned view of $1,050-$1,060 million. Organic growth is projected at 9% now compared with the previous guidance of 7%.
Finally, the company envisions adjusted earnings per share (EPS) of $4-$4.04, up from the $3.93-$3.98 range mentioned before. In fiscal 2021, Prestige Consumer’s top and bottom lines were $943.4 million and $3.24 per share, respectively.
This Zacks Rank #2 (Buy) stock has rallied 15.3% in the past three months against the industry’s decline of 26.8%.
Other Stocks to Consider
Some similar-ranked stocks are Funko, Inc. (FNKO - Free Report) , Guess?, Inc. (GES - Free Report) and Gildan Activewear Inc. (GIL - Free Report) .
Funko, the pop culture consumer products company, currently carries a Zacks Rank #2 (Buy). Shares of Funko have declined 11.1% in the past six months. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for Funko’s 2022 sales and EPS suggests growth of 8.7% and 9.5%, respectively, from the year-ago reported figure. FNKO has a trailing four-quarter earnings surprise of 110.7%, on average.
Guess?, which designs, markets, distributes and licenses lifestyle collections of apparel and accessories, carries a Zacks Rank #2 at present. Shares of Guess? have moved up 3.5% in the past six months.
The Zacks Consensus Estimate for Guess?’s fiscal 2022 sales and EPS suggests growth of 6% and 11.7%, respectively, from the year-ago reported number. GES has a trailing four-quarter earnings surprise of 97%, on average.
Gildan Activewear, which manufactures and sells various apparel products, carries a Zacks Rank #2 at present. It has a trailing four-quarter earnings surprise of 9.7%, on average. Shares of Gildan Activewear have moved up 14.8% in the past six months.
The Zacks Consensus Estimate for Gildan Activewear’s 2022 sales and EPS suggests growth of 8.2% and 9.4%, respectively, from the year-ago reported figure. GIL has a trailing four-quarter earnings surprise of around 85%, on average.