We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Avon Products is the world's largest direct seller with more than 6 million active independent sales representatives. Avon products which are available in over 100 countries include color cosmetics, skincare, fragrance, fashion and home products, under brand names like Avon Color, ANEW, Skin-So-Soft and Advance Techniques.
Disappointing Results
The company reported dismal results for its second quarter, missing on both the top and bottom lines.
Adjusted loss from continuing operations of 3 cents per share missed the Zacks Consensus Estimate of 5 cents.
Total revenue fell 3% year over year to $1,395.9 million, below the Zacks Consensus Estimate of $1,443.3 million.
Active representatives declined 3% with decreases in all segments. Average order fell 1% with declines in North Latin America and Europe, Middle East & Africa.
The stock plunged more than 10% following the release and is now down about 52% this year.
Falling Estimates
As a result of worsening outlook for the company, analysts have been revising their estimates lower. Zacks Consensus Estimates for the current and the next year are now at $0.09 and $0.27 per share, down from $0.20 and $0.35 per share, before the results. Declining estimates sent AVP back to Zacks Rank # 5.
The following chart shows the negative earnings and price momentum for AVP:
The company announced the departure of its CEO on the same day it reported Q2 results. The release said “Sheri McCoy will step down as Chief Executive Officer and as a director on March 31, 2018, in line with her commitments to Avon's Board of Directors to transform the business.”
Better Play in the Industry?
Cosmetics industry is currently ranked 91 out of 265 Zacks industries (top 34%). Investors could look at a better ranked stock in the industry—Estee Lauder (EL)—which carries a Zacks Rank #1 (Strong Buy) as of now.
The Bottom Line
In view of the ongoing execution of the three-year turnover plan, the outlook for the company remains cloudy. It remains to be seen whether the company will be able to successfully execute its strategy and improve its growth. Investors should therefore avoid this stock for the time being.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana. Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
Image: Bigstock
Bear of the Day: Avon (AVP)
Avon Products is the world's largest direct seller with more than 6 million active independent sales representatives. Avon products which are available in over 100 countries include color cosmetics, skincare, fragrance, fashion and home products, under brand names like Avon Color, ANEW, Skin-So-Soft and Advance Techniques.
Disappointing Results
The company reported dismal results for its second quarter, missing on both the top and bottom lines.
Adjusted loss from continuing operations of 3 cents per share missed the Zacks Consensus Estimate of 5 cents.
Total revenue fell 3% year over year to $1,395.9 million, below the Zacks Consensus Estimate of $1,443.3 million.
Active representatives declined 3% with decreases in all segments. Average order fell 1% with declines in North Latin America and Europe, Middle East & Africa.
The stock plunged more than 10% following the release and is now down about 52% this year.
Falling Estimates
As a result of worsening outlook for the company, analysts have been revising their estimates lower. Zacks Consensus Estimates for the current and the next year are now at $0.09 and $0.27 per share, down from $0.20 and $0.35 per share, before the results. Declining estimates sent AVP back to Zacks Rank # 5.
The following chart shows the negative earnings and price momentum for AVP:
Avon Products, Inc. Price and Consensus
Avon Products, Inc. Price and Consensus | Avon Products, Inc. Quote
CEO Steps Down
The company announced the departure of its CEO on the same day it reported Q2 results. The release said “Sheri McCoy will step down as Chief Executive Officer and as a director on March 31, 2018, in line with her commitments to Avon's Board of Directors to transform the business.”
Better Play in the Industry?
Cosmetics industry is currently ranked 91 out of 265 Zacks industries (top 34%). Investors could look at a better ranked stock in the industry—Estee Lauder (EL)—which carries a Zacks Rank #1 (Strong Buy) as of now.
The Bottom Line
In view of the ongoing execution of the three-year turnover plan, the outlook for the company remains cloudy. It remains to be seen whether the company will be able to successfully execute its strategy and improve its growth. Investors should therefore avoid this stock for the time being.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot trades we're targeting>>