Earnings Miss: Helen of Troy Limited Missed EPS By 76% And Analysts Are Revising Their Forecasts

Helen of Troy Limited (NASDAQ:HELE) missed earnings with its latest first-quarter results, disappointing overly-optimistic forecasters. Results showed a clear earnings miss, with US$417m revenue coming in 6.5% lower than what the analystsexpected. Statutory earnings per share (EPS) of US$0.26 missed the mark badly, arriving some 76% below what was expected. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

View our latest analysis for Helen of Troy

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Taking into account the latest results, the current consensus, from the six analysts covering Helen of Troy, is for revenues of US$1.90b in 2025. This implies a small 2.5% reduction in Helen of Troy's revenue over the past 12 months. Statutory earnings per share are forecast to crater 23% to US$5.14 in the same period. Before this earnings report, the analysts had been forecasting revenues of US$1.99b and earnings per share (EPS) of US$7.18 in 2025. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a large cut to earnings per share numbers.

It'll come as no surprise then, to learn that the analysts have cut their price target 36% to US$82.00. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Helen of Troy at US$105 per share, while the most bearish prices it at US$67.00. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Helen of Troy shareholders.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that revenue is expected to reverse, with a forecast 3.4% annualised decline to the end of 2025. That is a notable change from historical growth of 4.1% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 5.9% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Helen of Troy is expected to lag the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Helen of Troy's future valuation.

With that in mind, we wouldn't be too quick to come to a conclusion on Helen of Troy. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Helen of Troy going out to 2027, and you can see them free on our platform here..

You should always think about risks though. Case in point, we've spotted 1 warning sign for Helen of Troy you should be aware of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com