Let’s dig into the relative performance of Inter Parfums (NASDAQ: IPAR) and its peers as we unravel the now-completed Q2 personal care earnings season.
While personal care products products may seem more discretionary than food, consumers tend to maintain or even boost their spending on the category during tough times. This phenomenon is known as "the lipstick effect" by economists, which states that consumers still want some semblance of affordable luxuries like beauty and wellness when the economy is sputtering. Consumer tastes are constantly changing, and personal care companies are currently responding to the public’s increased desire for ethically produced goods by featuring natural ingredients in their products.
The 12 personal care stocks we track reported a satisfactory Q2. As a group, revenues beat analysts’ consensus estimates by 1.7% while next quarter’s revenue guidance was 7% below.
In light of this news, share prices of the companies have held steady. On average, they are relatively unchanged since the latest earnings results.
Inter Parfums (NASDAQ: IPAR)
With licenses to produce colognes and perfumes under brands such as Kate Spade, Van Cleef & Arpels, and Abercrombie & Fitch, Inter Parfums (NASDAQ: IPAR) manufactures and distributes fragrances worldwide.
Inter Parfums reported revenues of $333.9 million, down 2.4% year on year. This print was in line with analysts’ expectations, but overall, it was a mixed quarter for the company with full-year revenue guidance beating analysts’ expectations but a significant miss of analysts’ gross margin estimates.
Inter Parfums scored the highest full-year guidance raise of the whole group. Still, the market seems discontent with the results. The stock is down 7.9% since reporting and currently trades at $101.97.
Is now the time to buy Inter Parfums? Access our full analysis of the earnings results here, it’s free.
Best Q2: USANA (NYSE: USNA)
Going to market with a direct selling model rather than through traditional retailers, USANA Health Sciences (NYSE: USNA) manufactures and sells nutritional, personal care, and skincare products.
USANA reported revenues of $235.8 million, up 10.8% year on year, outperforming analysts’ expectations by 4.7%. The business had an exceptional quarter with an impressive beat of analysts’ EBITDA estimates and a beat of analysts’ EPS estimates.
USANA delivered the fastest revenue growth among its peers. Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 7.9% since reporting. It currently trades at $29.03.
Is now the time to buy USANA? Access our full analysis of the earnings results here, it’s free.
Weakest Q2: Edgewell Personal Care (NYSE: EPC)
Boasting brands such as Banana Boat, Schick, and Skintimate, Edgewell Personal Care (NYSE: EPC) sells personal care products in the skin and sun care, shave, and feminine care categories.
Edgewell Personal Care reported revenues of $627.2 million, down 3.2% year on year, falling short of analysts’ expectations by 4.2%. It was a disappointing quarter as it posted a significant miss of analysts’ organic revenue and EBITDA estimates.
Edgewell Personal Care delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 22% since the results and currently trades at $19.51.
Read our full analysis of Edgewell Personal Care’s results here.
Medifast (NYSE: MED)
Known for its Optavia program that combines portion-controlled meal replacements with coaching, Medifast (NYSE: MED) has a broad product portfolio of bars, snacks, drinks, and desserts for those looking to lose weight or consume healthier foods.
Medifast reported revenues of $105.6 million, down 37.4% year on year. This result topped analysts’ expectations by 3.7%. Overall, it was a strong quarter as it also recorded a beat of analysts’ EPS estimates.
Medifast had the slowest revenue growth among its peers. The stock is up 4.5% since reporting and currently trades at $14.06.
Read our full, actionable report on Medifast here, it’s free.
Olaplex (NASDAQ: OLPX)
Rising to fame on TikTok because of its “bond building" hair products, Olaplex (NASDAQ: OLPX) offers products and treatments that repair the damage caused by traditional heat and chemical-based styling goods.
Olaplex reported revenues of $106.3 million, up 2.3% year on year. This print beat analysts’ expectations by 5%. It was a strong quarter as it also logged an impressive beat of analysts’ EBITDA estimates.
Olaplex pulled off the biggest analyst estimates beat but had the weakest full-year guidance update among its peers. The stock is flat since reporting and currently trades at $1.41.
Read our full, actionable report on Olaplex here, it’s free.
Market Update
As a result of the Fed’s rate hikes in 2022 and 2023, inflation has come down from frothy levels post-pandemic. The general rise in the price of goods and services is trending towards the Fed’s 2% goal as of late, which is good news. The higher rates that fought inflation also didn't slow economic activity enough to catalyze a recession. So far, soft landing. This, combined with recent rate cuts (half a percent in September 2024 and a quarter percent in November 2024) have led to strong stock market performance in 2024. The icing on the cake for 2024 returns was Donald Trump’s victory in the U.S. Presidential Election in early November, sending major indices to all-time highs in the week following the election. Still, debates around the health of the economy and the impact of potential tariffs and corporate tax cuts remain, leaving much uncertainty around 2025.
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