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Prestige Consumer Healthcare Inc. (PBH - Free Report) recorded third-quarter fiscal 2025 earnings per share (EPS) of $1.22, which exceeded the Zacks Consensus Estimate by 5.2%. The bottom line improved 15.1% from the year-ago reported figure.
Following the release, shares of PBH rose 14.8% at yesterday’s close.
Total revenues increased 2.7% year over year to $290.3 million and exceeded the Zacks Consensus Estimate by 1.5%. The quarter’s performance reflected continued strong growth in the International OTC segment, partially offset by declines in the Cough & Cold category.
Segments in Detail
The company conducts its operations through two reportable segments — North American OTC Healthcare and International OTC Healthcare.
Revenues in the North American OTC Healthcare segment totaled $238.9 million, up 1% from the year-earlier quarter. Within this, strong GI and Dermatologicals category growth was partially offset by declines in the Cough & Cold category.
Our model projected the segment’s revenues to be $237.8 million in the third quarter.
Revenues in the International OTC Healthcare segment were $5.4 million, up 11.3% from the year-ago quarter’s figure (up 8.3% at constant exchange rate or CER). The company reported broad-based growth in Australia revenues led by the Hydralyte brand.
Our model projected the segment’s revenues to be $48.6 million in the third quarter.
Prestige Consumer Healthcare Inc. Price, Consensus and EPS Surprise
The adjusted gross profit in the fiscal third quarter rose 1.9% year over year to $162.9 million. Meanwhile, the adjusted gross margin contracted 44 basis points (bps) year over year to 56.1% on a 3.7% increase in the cost of sales (excluding depreciation).
During the quarter, advertising and marketing expenses declined 3.9% to $37.9 million. General and administrative expenses were up 0.7% to $26.2 million. Adjusted operating income in the quarter under review was $98.1 million, highlighting an increase of 4.6%. The adjusted operating margin expanded 63 bps to 33.8%.
Financial Update
Prestige Consumer exited the fiscal third quarter with cash and cash equivalents of $50.9 million compared with $51.5 million recorded at the end of the second quarter of fiscal 2025. Net long-term debt totaled $991.9 million, down from $1.05 billion at the end of the fiscal second quarter.
The cumulative net cash provided by operating activities at the end of the fiscal third quarter was $189.7 million compared with $182 million in the year-ago period. The cumulative adjusted free cash flow at the end of the fiscal third quarter was $184.9 million compared with $175.6 million in the year-ago period.
Guidance
The company updated its fiscal 2025 revenue growth and EPS outlook.
Revenues for the full year are anticipated in the range of $1.128 billion-$1.132 billion (compared with the earlier range of $1.125 billion-$1.140 billion). Organic revenue growth for the full year is anticipated to be approximately 1% (unchanged). The Zacks Consensus Estimate for fiscal 2025 revenues is pegged at $1.13 billion.
Prestige Consumer expects fiscal 2025 adjusted EPS to be approximately $4.50 (the earlier range was $4.40-$4.46). The Zacks Consensus Estimate for fiscal 2025 EPS stands at $4.46.
Free cash flow for the full year is likely to be $240 million or more (unchanged).
Our Take
PBH exited the fiscal third quarter of 2025 with better-than-expected results. The company experienced continued strong international growth, banking on strong sales of the Hydralyte brand, coupled with broad-based growth across nearly all of PBH’s North American categories. This included year-over-year growth in the Summer's Eve brand as well as sequential sales growth within Clear Eyes. The raised fiscal 2025 EPS guidance instilled optimism among investors.
However, the contraction of the adjusted gross margin during the quarter was discouraging.
Zacks Rank and Other Key Picks
Prestige Consumer currently carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks from the broader medical space are Quest Diagnostics (DGX - Free Report) , ResMed (RMD - Free Report) and Cardinal Health (CAH - Free Report) .
Quest Diagnostics reported fourth-quarter 2024 adjusted EPS of $2.23, which topped the Zacks Consensus Estimate by 1.8%. Revenues of $2.62 billion beat the Zacks Consensus Estimate by 1.9%. DGX carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
DGX has an earnings yield of 5.9% compared with the industry’s 4.1% yield. The company surpassed earnings estimates in each of the trailing four quarters, the average surprise being 3.8%.
ResMed, carrying a Zacks Rank #2, posted second-quarter fiscal 2025 adjusted EPS of $2.43, topping the Zacks Consensus Estimate by 5.6%. Revenues of $1.28 billion exceeded the Zacks Consensus Estimate by 1.6%.
RMD has an estimated fiscal 2025 earnings growth rate of 21.9% compared with the industry’s 13.2%. The company’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 6.9%.
Cardinal Health, carrying a Zacks Rank #2, posted second-quarter fiscal 2025 adjusted EPS of $1.93, topping the Zacks Consensus Estimate by 10.3%. Revenues of $55.26 billion exceeded the Zacks Consensus Estimate by 0.7%.
CAH has an estimated five-year earnings growth rate of 10.7% compared with the industry’s 9.3%. The company’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 9.6%.
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PBH Q3 Earnings Beat Estimates, EPS View Raised, Shares Gain 14.8%
Prestige Consumer Healthcare Inc. (PBH - Free Report) recorded third-quarter fiscal 2025 earnings per share (EPS) of $1.22, which exceeded the Zacks Consensus Estimate by 5.2%. The bottom line improved 15.1% from the year-ago reported figure.
See the Zacks Earnings Calendar to stay ahead of market-making news.
Following the release, shares of PBH rose 14.8% at yesterday’s close.
Total revenues increased 2.7% year over year to $290.3 million and exceeded the Zacks Consensus Estimate by 1.5%. The quarter’s performance reflected continued strong growth in the International OTC segment, partially offset by declines in the Cough & Cold category.
Segments in Detail
The company conducts its operations through two reportable segments — North American OTC Healthcare and International OTC Healthcare.
Revenues in the North American OTC Healthcare segment totaled $238.9 million, up 1% from the year-earlier quarter. Within this, strong GI and Dermatologicals category growth was partially offset by declines in the Cough & Cold category.
Our model projected the segment’s revenues to be $237.8 million in the third quarter.
Revenues in the International OTC Healthcare segment were $5.4 million, up 11.3% from the year-ago quarter’s figure (up 8.3% at constant exchange rate or CER). The company reported broad-based growth in Australia revenues led by the Hydralyte brand.
Our model projected the segment’s revenues to be $48.6 million in the third quarter.
Prestige Consumer Healthcare Inc. Price, Consensus and EPS Surprise
Prestige Consumer Healthcare Inc. price-consensus-eps-surprise-chart | Prestige Consumer Healthcare Inc. Quote
Margins
The adjusted gross profit in the fiscal third quarter rose 1.9% year over year to $162.9 million. Meanwhile, the adjusted gross margin contracted 44 basis points (bps) year over year to 56.1% on a 3.7% increase in the cost of sales (excluding depreciation).
During the quarter, advertising and marketing expenses declined 3.9% to $37.9 million. General and administrative expenses were up 0.7% to $26.2 million. Adjusted operating income in the quarter under review was $98.1 million, highlighting an increase of 4.6%. The adjusted operating margin expanded 63 bps to 33.8%.
Financial Update
Prestige Consumer exited the fiscal third quarter with cash and cash equivalents of $50.9 million compared with $51.5 million recorded at the end of the second quarter of fiscal 2025. Net long-term debt totaled $991.9 million, down from $1.05 billion at the end of the fiscal second quarter.
The cumulative net cash provided by operating activities at the end of the fiscal third quarter was $189.7 million compared with $182 million in the year-ago period. The cumulative adjusted free cash flow at the end of the fiscal third quarter was $184.9 million compared with $175.6 million in the year-ago period.
Guidance
The company updated its fiscal 2025 revenue growth and EPS outlook.
Revenues for the full year are anticipated in the range of $1.128 billion-$1.132 billion (compared with the earlier range of $1.125 billion-$1.140 billion). Organic revenue growth for the full year is anticipated to be approximately 1% (unchanged). The Zacks Consensus Estimate for fiscal 2025 revenues is pegged at $1.13 billion.
Prestige Consumer expects fiscal 2025 adjusted EPS to be approximately $4.50 (the earlier range was $4.40-$4.46). The Zacks Consensus Estimate for fiscal 2025 EPS stands at $4.46.
Free cash flow for the full year is likely to be $240 million or more (unchanged).
Our Take
PBH exited the fiscal third quarter of 2025 with better-than-expected results. The company experienced continued strong international growth, banking on strong sales of the Hydralyte brand, coupled with broad-based growth across nearly all of PBH’s North American categories. This included year-over-year growth in the Summer's Eve brand as well as sequential sales growth within Clear Eyes. The raised fiscal 2025 EPS guidance instilled optimism among investors.
However, the contraction of the adjusted gross margin during the quarter was discouraging.
Zacks Rank and Other Key Picks
Prestige Consumer currently carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks from the broader medical space are Quest Diagnostics (DGX - Free Report) , ResMed (RMD - Free Report) and Cardinal Health (CAH - Free Report) .
Quest Diagnostics reported fourth-quarter 2024 adjusted EPS of $2.23, which topped the Zacks Consensus Estimate by 1.8%. Revenues of $2.62 billion beat the Zacks Consensus Estimate by 1.9%. DGX carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
DGX has an earnings yield of 5.9% compared with the industry’s 4.1% yield. The company surpassed earnings estimates in each of the trailing four quarters, the average surprise being 3.8%.
ResMed, carrying a Zacks Rank #2, posted second-quarter fiscal 2025 adjusted EPS of $2.43, topping the Zacks Consensus Estimate by 5.6%. Revenues of $1.28 billion exceeded the Zacks Consensus Estimate by 1.6%.
RMD has an estimated fiscal 2025 earnings growth rate of 21.9% compared with the industry’s 13.2%. The company’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 6.9%.
Cardinal Health, carrying a Zacks Rank #2, posted second-quarter fiscal 2025 adjusted EPS of $1.93, topping the Zacks Consensus Estimate by 10.3%. Revenues of $55.26 billion exceeded the Zacks Consensus Estimate by 0.7%.
CAH has an estimated five-year earnings growth rate of 10.7% compared with the industry’s 9.3%. The company’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 9.6%.