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Prestige Consumer (PBH) Adds TheraTears to Its Eye Care Portfolio
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Prestige Consumer Healthcare Inc. (PBH - Free Report) has successfully concluded the acquisition of TheraTears and four other over-the-counter consumer brands across the VMS and Cough & Cold categories from Akorn Operating Company LLC. The deal worth $230 million, in cash, was initially announced on May 27 and has met all the terms of the asset purchase agreement. This move is likely to be accretive to Prestige Consumer’s eye care portfolio.
The asset agreement is expected to generate tax benefits of roughly $30 million and an annual EBITDA of approximately $20 million. Also, the transaction will contribute roughly $60 million to revenues, 10 cents to earnings per share and $13 million to operating cash flow, on an annual basis.
Notably, the TheraTears eye care brand accounts for nearly 80% of Akorn’s portfolio revenues. The brand also boasts a long record of market share gains and revenue growth in the dry eye category. As a result, the addition of TheraTears is likely to enhance Prestige Consumer’s eye care category, which already includes notable products from the iconic Clear Eyes brand.
What Else Should You Know?
Prestige Consumer has been gaining from solid market share brand positions, efficient marketing efforts, diverse brands and strong e-commerce initiatives. The company’s fourth-quarter fiscal 2021 results reflect gains from its e-commerce investments. Courtesy of its constant investments, the company has a greater share in the e-commerce channel compared with brick and mortar. As a result, e-commerce sales doubled and constituted nearly 11% of the company’s revenues in fiscal 2021.
Encouragingly, management expects these factors to act as key growth drivers for fiscal 2022 and beyond. Moreover, it envisions a relatively stable performance compared with fiscal 2021. Also, fiscal 2022 organic growth is projected to be 1.5-2%, in sync with the company’s long-term expectations for its leading brand portfolio, barring some categories that are hurt by the pandemic. Further, strong cash flow along with stringent cost management is likely to result in low-double-digit growth in earnings. Notably, fiscal 2021 adjusted earnings per share are projected to be $3.58 or more along with revenues of nearly $957-$962 million.
Shares of this Zacks Rank #3 (Hold) company have gained 23% in the past three months against the industry’s decline of 0.2%.
Image Source: Zacks Investment Research
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Spectrum Brands (SPB - Free Report) also flaunts a Zacks Rank #1 and its bottom line has outperformed the Zacks Consensus Estimate by 83.1% in the trailing four quarters, on average.
Alto Ingredients (ALTO - Free Report) has a Zacks Rank #2 (Buy). The company’s bottom line has outperformed the Zacks Consensus Estimate by 25.2% in the trailing four quarters, on average.
Zacks Names “Single Best Pick to Double”
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
You know this company from its past glory days, but few would expect that it’s poised for a monster turnaround. Fresh from a successful repositioning and flush with A-list celeb endorsements, it could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in a little more than 9 months and Nvidia which boomed +175.9% in one year.
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Prestige Consumer (PBH) Adds TheraTears to Its Eye Care Portfolio
Prestige Consumer Healthcare Inc. (PBH - Free Report) has successfully concluded the acquisition of TheraTears and four other over-the-counter consumer brands across the VMS and Cough & Cold categories from Akorn Operating Company LLC. The deal worth $230 million, in cash, was initially announced on May 27 and has met all the terms of the asset purchase agreement. This move is likely to be accretive to Prestige Consumer’s eye care portfolio.
The asset agreement is expected to generate tax benefits of roughly $30 million and an annual EBITDA of approximately $20 million. Also, the transaction will contribute roughly $60 million to revenues, 10 cents to earnings per share and $13 million to operating cash flow, on an annual basis.
Notably, the TheraTears eye care brand accounts for nearly 80% of Akorn’s portfolio revenues. The brand also boasts a long record of market share gains and revenue growth in the dry eye category. As a result, the addition of TheraTears is likely to enhance Prestige Consumer’s eye care category, which already includes notable products from the iconic Clear Eyes brand.
What Else Should You Know?
Prestige Consumer has been gaining from solid market share brand positions, efficient marketing efforts, diverse brands and strong e-commerce initiatives. The company’s fourth-quarter fiscal 2021 results reflect gains from its e-commerce investments. Courtesy of its constant investments, the company has a greater share in the e-commerce channel compared with brick and mortar. As a result, e-commerce sales doubled and constituted nearly 11% of the company’s revenues in fiscal 2021.
Encouragingly, management expects these factors to act as key growth drivers for fiscal 2022 and beyond. Moreover, it envisions a relatively stable performance compared with fiscal 2021. Also, fiscal 2022 organic growth is projected to be 1.5-2%, in sync with the company’s long-term expectations for its leading brand portfolio, barring some categories that are hurt by the pandemic. Further, strong cash flow along with stringent cost management is likely to result in low-double-digit growth in earnings. Notably, fiscal 2021 adjusted earnings per share are projected to be $3.58 or more along with revenues of nearly $957-$962 million.
Shares of this Zacks Rank #3 (Hold) company have gained 23% in the past three months against the industry’s decline of 0.2%.
Looking for High-Performance Stocks? Here’re a Few
Lifetime Brands (LCUT - Free Report) has an expected long-term earnings growth rate of 14% and a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Spectrum Brands (SPB - Free Report) also flaunts a Zacks Rank #1 and its bottom line has outperformed the Zacks Consensus Estimate by 83.1% in the trailing four quarters, on average.
Alto Ingredients (ALTO - Free Report) has a Zacks Rank #2 (Buy). The company’s bottom line has outperformed the Zacks Consensus Estimate by 25.2% in the trailing four quarters, on average.
Zacks Names “Single Best Pick to Double”
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
You know this company from its past glory days, but few would expect that it’s poised for a monster turnaround. Fresh from a successful repositioning and flush with A-list celeb endorsements, it could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in a little more than 9 months and Nvidia which boomed +175.9% in one year.
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