Earnings results often indicate what direction a company will take in the months ahead. With Q1 behind us, let’s have a look at Olaplex (NASDAQ: OLPX) and its peers.
While personal care products products may seem more discretionary than food, consumers tend to maintain or even boost their spending on the category during tough times. This phenomenon is known as "the lipstick effect" by economists, which states that consumers still want some semblance of affordable luxuries like beauty and wellness when the economy is sputtering. Consumer tastes are constantly changing, and personal care companies are currently responding to the public’s increased desire for ethically produced goods by featuring natural ingredients in their products.
The 12 personal care stocks we track reported a strong Q1. As a group, revenues beat analysts’ consensus estimates by 2.2% while next quarter’s revenue guidance was 5.5% below.
Luckily, personal care stocks have performed well with share prices up 12.1% on average since the latest earnings results.
Olaplex (NASDAQ: OLPX)
Rising to fame on TikTok because of its “bond building" hair products, Olaplex (NASDAQ: OLPX) offers products and treatments that repair the damage caused by traditional heat and chemical-based styling goods.
Olaplex reported revenues of $96.98 million, down 1.9% year on year. This print exceeded analysts’ expectations by 3.9%. Overall, it was a strong quarter for the company with a solid beat of analysts’ EBITDA estimates.
Amanda Baldwin, OLAPLEX’s Chief Executive Officer, commented: "We had a solid start to the year as the quarter marked continued progress on our transformation and our Bonds and Beyond strategy, with first quarter sales coming in ahead of our expectations. As we look ahead, we believe in our ability to navigate the dynamic environment and will continue to invest behind our strategic priorities."
The stock is down 1.5% since reporting and currently trades at $1.30.
Is now the time to buy Olaplex? Access our full analysis of the earnings results here, it’s free.
Best Q1: The Honest Company (NASDAQ: HNST)
Co-founded by actress Jessica Alba, The Honest Company (NASDAQ: HNST) sells diapers and wipes, skin care products, and household cleaning products.
The Honest Company reported revenues of $97.25 million, up 12.8% year on year, outperforming analysts’ expectations by 5.7%. The business had an exceptional quarter with a solid beat of analysts’ EPS estimates and an impressive beat of analysts’ EBITDA estimates.
The Honest Company achieved the fastest revenue growth among its peers. The market seems happy with the results as the stock is up 5.9% since reporting. It currently trades at $5.07.
Is now the time to buy The Honest Company? Access our full analysis of the earnings results here, it’s free.
Weakest Q1: Edgewell Personal Care (NYSE: EPC)
Boasting brands such as Banana Boat, Schick, and Skintimate, Edgewell Personal Care (NYSE: EPC) sells personal care products in the skin and sun care, shave, and feminine care categories.
Edgewell Personal Care reported revenues of $580.7 million, down 3.1% year on year, falling short of analysts’ expectations by 1.8%. It was a slower quarter as it posted a miss of analysts’ organic revenue estimates and full-year EBITDA guidance missing analysts’ expectations.
Edgewell Personal Care delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 8% since the results and currently trades at $27.62.
Read our full analysis of Edgewell Personal Care’s results here.
Estée Lauder (NYSE: EL)
Named after its founder, who was an entrepreneurial woman from New York with a passion for skincare, Estée Lauder (NYSE: EL) is a one-stop beauty shop with products in skincare, fragrance, makeup, sun protection, and men’s grooming.
Estée Lauder reported revenues of $3.55 billion, down 9.9% year on year. This result surpassed analysts’ expectations by 1.2%. Overall, it was a very strong quarter as it also put up a solid beat of analysts’ EPS estimates and an impressive beat of analysts’ EBITDA estimates.
The stock is up 11.7% since reporting and currently trades at $66.91.
Read our full, actionable report on Estée Lauder here, it’s free.
Coty (NYSE: COTY)
With a portfolio boasting many household brands, Coty (NYSE: COTY) is a beauty products powerhouse spanning cosmetics, fragrances, and skincare.
Coty reported revenues of $1.30 billion, down 6.2% year on year. This number lagged analysts' expectations by 1%. More broadly, it was a mixed quarter as it also produced an impressive beat of analysts’ EBITDA estimates but a significant miss of analysts’ EPS estimates.
The stock is down 4.8% since reporting and currently trades at $4.92.
Read our full, actionable report on Coty here, it’s free.
Market Update
Thanks to the Fed’s series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% in November), and a notable surge followed Donald Trump’s presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by potential trade policy changes and corporate tax discussions, which could impact business confidence and growth. The path forward holds both optimism and caution as new policies take shape.
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