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Prestige Consumer Healthcare Inc. (PBH - Free Report) recorded first-quarter fiscal 2025 adjusted earnings per share (EPS) of 90 cents, which surpassed the Zacks Consensus Estimate by 4.7%. However, the bottom line declined 15.1% from the year-ago period’s reported figure.
On a reported basis, EPS was 98 cents in the fiscal first quarter of 2025.
Total revenues dropped 4.4% year over year to $267.1 million but exceeded the Zacks Consensus Estimate by 2.7%. Excluding currency impacts, revenues were down 4.3%. Revenues were impacted by the limited ability to meet the strong demand for Clear Eyes and the decline in the Cough & Cold and Women’s Health categories, partially offset by continued strong growth in the International OTC segment.
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 $232.3 million, down 5.6% from the year-earlier quarter. Our model projected the segment’s revenues to be $221.7 million in the first quarter.
The revenue decline in the quarter was due to the inability to fully cater to demand for Clear Eyes and declines in the Cough & Cold and Women’s Health categories.
Revenues in the International OTC Healthcare segment were $34.8 million, up 5% from the year-ago quarter’s figure (up 5.3% at constant exchange rate or CER). Our model projected the segment’s revenues to be $38.4 million in the first quarter.
The company reported strong performance across the Hydralyte brand as well as growth in other international regions.
Prestige Consumer Healthcare Inc. Price, Consensus and EPS Surprise
The gross profit in the fiscal first quarter declined 5.6% year over year to $146 million. Meanwhile, the gross margin contracted 72 basis points (bps) year over year to 54.7% despite a 2.8% decrease in the cost of sales (excluding depreciation).
During the quarter, advertising and marketing expenses rose 8.7% to $39.4 million. General and administrative expenses rose 4.4% to $28.9 million. Adjusted operating income in the quarter under review was $77.7 million, highlighting a decrease of 14.3%. The adjusted operating margin contracted 339 bps to 29.1%.
Financial Update
Prestige Consumer exited the fiscal first quarter with cash and cash equivalents of $34.3 million compared with the $46.5 million recorded at the end of fiscal 2024. Long-term debt totaled $1.09 billion, down from $1.13 billion at the end of fiscal 2024.
The cumulative net cash provided by operating activities at first-quarter end was $54.8 million compared with $48.1 million in the year-ago period. The cumulative adjusted free cash flow at the end of the fiscal first quarter was $53.6 million compared with $46.6 million in the year-ago period.
Guidance
The company reiterated its earlier-provided fiscal 2025 organic revenue growth and EPS outlook.
Revenues for the full year are once again anticipated in the range of $1.125 billion-$1.140 billion. Organic revenue growth for the full year is anticipated to be approximately 1%. The Zacks Consensus Estimate for fiscal 2025 revenues is pegged at $1.13 billion.
Prestige Consumer continues to expect fiscal 2025 EPS to be in the range of $4.40-$4.46, enabling full-year adjusted EPS growth of 5% to 6%. The Zacks Consensus Estimate for fiscal 2025 EPS stands at $4.41.
Free cash flow for the full year is likely to be $240 million or more (unchanged).
Our Take
PBH exited the fiscal first quarter of 2025 with better-than-expected revenues and earnings. However, the year-over-year decline on both fronts adds to our concern. Sales were largely impacted by the ongoing supply chain challenges in the Clear Eyes business. Meanwhile, the quarter’s results benefited from continued strong international growth that was broad-based and led by the Hydralyte brand.
The contraction of the gross and adjusted operating margins during the quarter was discouraging.
Zacks Rank and Key Picks
Prestige Consumer currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks from the broader medical space are Intuitive Surgical (ISRG - Free Report) , National Vision (EYE - Free Report) and Quest Diagnostics (DGX - Free Report) .
Intuitive Surgical reported second-quarter 2024 adjusted EPS of $1.78, which beat the Zacks Consensus Estimate by 16.3%. Revenues of $2.01 billion topped the consensus estimate by 2%. ISRG currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Intuitive Surgical has a long-term earnings growth rate of 16.1% for 2024 compared with the industry’s 14.1%. The company’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 8.97%.
National Vision, carrying a Zacks Rank #1 at present, reported second-quarter 2024 earnings of 15 cents per share, which surpassed the Zacks Consensus Estimate by 75%. Revenues of $451.7 million missed the Zacks Consensus Estimate by 2.8%.
EYE has an earnings growth rate of 41.5% for 2025 compared with the S&P 500’s 11.3%. The company beat on earnings in each of the trailing four quarters, the average surprise being 96.23%.
Quest Diagnostics, carrying a Zacks Rank #2 (Buy) at present, reported second-quarter adjusted EPS of $2.35, which beat the Zacks Consensus Estimate by 1.7%. Revenues of $2.40 billion outpaced the Zacks Consensus Estimate by 0.5%.
DGX has a historical five-year earnings growth rate of 7.4% compared with the industry’s 4.2%. The company’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 3.31%.
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Prestige Consumer's (PBH) Q1 Earnings Beat, Margins Shrink
Prestige Consumer Healthcare Inc. (PBH - Free Report) recorded first-quarter fiscal 2025 adjusted earnings per share (EPS) of 90 cents, which surpassed the Zacks Consensus Estimate by 4.7%. However, the bottom line declined 15.1% from the year-ago period’s reported figure.
On a reported basis, EPS was 98 cents in the fiscal first quarter of 2025.
Total revenues dropped 4.4% year over year to $267.1 million but exceeded the Zacks Consensus Estimate by 2.7%. Excluding currency impacts, revenues were down 4.3%. Revenues were impacted by the limited ability to meet the strong demand for Clear Eyes and the decline in the Cough & Cold and Women’s Health categories, partially offset by continued strong growth in the International OTC segment.
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 $232.3 million, down 5.6% from the year-earlier quarter. Our model projected the segment’s revenues to be $221.7 million in the first quarter.
The revenue decline in the quarter was due to the inability to fully cater to demand for Clear Eyes and declines in the Cough & Cold and Women’s Health categories.
Revenues in the International OTC Healthcare segment were $34.8 million, up 5% from the year-ago quarter’s figure (up 5.3% at constant exchange rate or CER). Our model projected the segment’s revenues to be $38.4 million in the first quarter.
The company reported strong performance across the Hydralyte brand as well as growth in other international regions.
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 gross profit in the fiscal first quarter declined 5.6% year over year to $146 million. Meanwhile, the gross margin contracted 72 basis points (bps) year over year to 54.7% despite a 2.8% decrease in the cost of sales (excluding depreciation).
During the quarter, advertising and marketing expenses rose 8.7% to $39.4 million. General and administrative expenses rose 4.4% to $28.9 million. Adjusted operating income in the quarter under review was $77.7 million, highlighting a decrease of 14.3%. The adjusted operating margin contracted 339 bps to 29.1%.
Financial Update
Prestige Consumer exited the fiscal first quarter with cash and cash equivalents of $34.3 million compared with the $46.5 million recorded at the end of fiscal 2024. Long-term debt totaled $1.09 billion, down from $1.13 billion at the end of fiscal 2024.
The cumulative net cash provided by operating activities at first-quarter end was $54.8 million compared with $48.1 million in the year-ago period. The cumulative adjusted free cash flow at the end of the fiscal first quarter was $53.6 million compared with $46.6 million in the year-ago period.
Guidance
The company reiterated its earlier-provided fiscal 2025 organic revenue growth and EPS outlook.
Revenues for the full year are once again anticipated in the range of $1.125 billion-$1.140 billion. Organic revenue growth for the full year is anticipated to be approximately 1%. The Zacks Consensus Estimate for fiscal 2025 revenues is pegged at $1.13 billion.
Prestige Consumer continues to expect fiscal 2025 EPS to be in the range of $4.40-$4.46, enabling full-year adjusted EPS growth of 5% to 6%. The Zacks Consensus Estimate for fiscal 2025 EPS stands at $4.41.
Free cash flow for the full year is likely to be $240 million or more (unchanged).
Our Take
PBH exited the fiscal first quarter of 2025 with better-than-expected revenues and earnings. However, the year-over-year decline on both fronts adds to our concern. Sales were largely impacted by the ongoing supply chain challenges in the Clear Eyes business. Meanwhile, the quarter’s results benefited from continued strong international growth that was broad-based and led by the Hydralyte brand.
The contraction of the gross and adjusted operating margins during the quarter was discouraging.
Zacks Rank and Key Picks
Prestige Consumer currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks from the broader medical space are Intuitive Surgical (ISRG - Free Report) , National Vision (EYE - Free Report) and Quest Diagnostics (DGX - Free Report) .
Intuitive Surgical reported second-quarter 2024 adjusted EPS of $1.78, which beat the Zacks Consensus Estimate by 16.3%. Revenues of $2.01 billion topped the consensus estimate by 2%. ISRG currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Intuitive Surgical has a long-term earnings growth rate of 16.1% for 2024 compared with the industry’s 14.1%. The company’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 8.97%.
National Vision, carrying a Zacks Rank #1 at present, reported second-quarter 2024 earnings of 15 cents per share, which surpassed the Zacks Consensus Estimate by 75%. Revenues of $451.7 million missed the Zacks Consensus Estimate by 2.8%.
EYE has an earnings growth rate of 41.5% for 2025 compared with the S&P 500’s 11.3%. The company beat on earnings in each of the trailing four quarters, the average surprise being 96.23%.
Quest Diagnostics, carrying a Zacks Rank #2 (Buy) at present, reported second-quarter adjusted EPS of $2.35, which beat the Zacks Consensus Estimate by 1.7%. Revenues of $2.40 billion outpaced the Zacks Consensus Estimate by 0.5%.
DGX has a historical five-year earnings growth rate of 7.4% compared with the industry’s 4.2%. The company’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 3.31%.