Yahoo Finance Prestige Consumer Healthcare (PBH) Down 0.4% Since Last Earnings Report: Can It Rebound?
It has been about a month since the last earnings report for Prestige Consumer Healthcare (PBH). Shares have lost about 0.4% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Prestige Consumer Healthcare due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Prestige Consumer Q4 Earnings, Revenues Lag Estimates, Gross Margin Up
Prestige Consumer delivered fourth-quarter fiscal 2024 earnings per share of $1.02, a 4.7% decline from the year-ago period’s figure. The metric also missed the Zacks Consensus Estimate by 10.5%.
GAAP earnings per share for the quarter was 98 cents, a significant improvement from the year-ago loss of $4.78 per share.
For the full year, adjusted earnings per share was $4.21, flat year over year.
Revenues
Total revenues in the fiscal fourth quarter declined 3.1% year over year (down 2.9% on an organic basis) to $276.9 million and lagged the Zacks Consensus Estimate by 3.5%.
The disappointing revenue performance for the quarter was caused by supply chain pressure late in the fourth quarter that affected Prestige Consumer’s ability to fulfill retailer orders.
Full-year revenues were $1.13 billion, unchanged from the fiscal 2023 level.
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 $231.1 million, down 4.6% from the year-earlier quarter.
The revenue performance for the quarter was due to the inability to supply customer orders late in the quarter in certain brands as well as a lower Women’s Health category and the strategic exit of private label business.
Revenues in the International OTC Healthcare segment were $45.9 million, up 5.3% from the year-ago quarter’s figure. The company reported strong performance across numerous brands and geographies. However, this was marred by poor supply chain constraints.
Margins
The gross profit in the fiscal fourth quarter declined 1.1% year over year to $153.9 million. Meanwhile, the gross margin expanded 115 basis points (bps) year over year to 55.6% on a 5.6% increase in the cost of sales (excluding depreciation).
During the quarter, advertising and marketing expenses rose 21.5% to $37.5 million, while general and administrative expenses decreased 4.3% to $26.5 million. Adjusted operating income in the quarter under review was $89.9 million, highlighting a decrease of 7.3%. The adjusted operating margin contracted 147 bps to 32.5%.
Financial Update
Prestige Consumer exited the fiscal fourth quarter with cash and cash equivalents of $46.5 million compared with the $63.6 million recorded at the end of the fiscal third quarter. Long-term debt totaled $1.13 billion, down from $1.20 billion at the end of fiscal third quarter.
The cumulative net cash provided by operating activities at fourth-quarter end was $248.9 million compared with $229.7 million in the year-ago period. The cumulative adjusted free cash flow at the end of the fiscal fourth quarter was $239.4 million compared with $221.9 million in the year-ago period.
Guidance
The company provided its initial fiscal 2025 organic revenue growth and earnings per share outlook.
Revenues for the full year are 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 $1.16 billion.
Prestige Consumer expects fiscal 2025 earnings per share to be in the range of $4.40-$4.46. The Zacks Consensus Estimate for fiscal 2025 earnings per share stands at $4.61.
Free cash flow for the full year is likely to be $240 million or more.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates review.
The consensus estimate has shifted -20.68% due to these changes.
VGM Scores
At this time, Prestige Consumer Healthcare has an average Growth Score of C, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise Prestige Consumer Healthcare has a Zacks Rank #5 (Strong Sell). We expect a below average return from the stock in the next few months.
Performance of an Industry Player
Prestige Consumer Healthcare belongs to the Zacks Medical - Products industry. Another stock from the same industry, Agios Pharmaceuticals (AGIO), has gained 36.4% over the past month. More than a month has passed since the company reported results for the quarter ended March 2024.
Agios Pharmaceuticals reported revenues of $8.19 million in the last reported quarter, representing a year-over-year change of +46%. EPS of -$1.45 for the same period compares with -$1.47 a year ago.
For the current quarter, Agios Pharmaceuticals is expected to post a loss of $1.58 per share, indicating a change of -4.6% from the year-ago quarter. The Zacks Consensus Estimate has changed +0.9% over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #2 (Buy) for Agios Pharmaceuticals. Also, the stock has a VGM Score of F.
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Prestige Consumer Healthcare Inc. (PBH) : Free Stock Analysis Report
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