Helen of Troy (HELE) to Post Q4 Earnings: Things Not So Rosy

Helen of Troy Limited HELE is slated to release fourth-quarter fiscal 2019 results on Apr 26. The company’s earnings came in line with the Zacks Consensus Estimate in the last reported quarter. Helen of Troy has delivered a positive earnings surprise of 16.5% in the trailing four quarters.

Let’s see how things are placed ahead of this release.

Helen of Troy Limited Price and EPS Surprise

Helen of Troy Limited Price and EPS Surprise | Helen of Troy Limited Quote

What to Expect?

The Zacks Consensus Estimate for earnings has remained stable over the past 30 days at $1.58, which indicates a decline of 6.5% from the year-ago quarter’s figure. Moreover, the consensus mark for revenues is $356 million, implying a drop of close to 9% from the figure reported in the year-ago quarter.

Factors Likely to Impact Q4

Helen of Troy’s Beauty segment sales are likely to remain soft in the quarter to be reported, owing to weakness across brick-and-mortar channels, sluggish personal care business, and withdrawal of certain products and brands. Further, decelerated growth in China’s e-commerce sales and adverse impacts from pricing actions pertaining to a key customer are expected to dent performance of the Health & Home segment.

These factors along with volatile currency movements raise concerns regarding the company’s top line. This in turn raises concern for the bottom line that is also likely to be hit by adverse mix and tariff-related impacts. Nonetheless, Helen of Troy’s performance in the quarter will be cushioned by strength in Leadership Brands. The company’s continued investments in product launches, marketing efforts and e-commerce strategies for Leadership Brands are set to contribute to the top line in the fourth quarter. Apart from this, focus on the restructuring plan, Project Refuel, is likely to generate savings and have a positive impact on the bottom line.

What the Zacks Model Unveils

Our proven model doesn’t show that Helen of Troyis likely to beat bottom-line estimates this quarter. For this to happen, a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Though Helen of Troy carries a Zacks Rank #3, its Earnings ESP of +0.00% makes surprise prediction difficult.

Stocks Poised to Beat Earnings Estimates

Estee Lauder EL has an Earnings ESP of +1.16% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Church & Dwight CHD has an Earnings ESP of +0.30% and a Zacks Rank #2.

Inter Parfums IPAR has an Earnings ESP of +5.73% and a Zacks Rank #3.

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The Estee Lauder Companies Inc. (EL): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.