NEW YORK (TheStreet) -- Helen of Troy
(HELE - Get Report) shares are down -4.3% in after hours trading on Wednesday following the release of the company's first quarter earnings results.
The consumer products developer reported revenues of $311 million for the quarter, a 2.4% jump over the previous year, but falling short of analysts $314.5 million consensus estimates.
The company also reported adjusted earnings of 83 cents per diluted share, 10 cents worse than what analysts had forecast for the quarter.
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TheStreet Ratings team rates HELEN OF TROY LTD as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate HELEN OF TROY LTD (HELE) a BUY. This is driven by some important positives, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its solid stock price performance, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Compared to its closing price of one year ago, HELE's share price has jumped by 51.98%, exceeding the performance of the broader market during that same time frame. Looking ahead, the stock's sharp rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
- HELE's debt-to-equity ratio is very low at 0.19 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.87 is somewhat weak and could be cause for future problems.
- 42.95% is the gross profit margin for HELEN OF TROY LTD which we consider to be strong. Regardless of HELE's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, HELE's net profit margin of 3.52% compares favorably to the industry average.
- HELE, with its decline in revenue, underperformed when compared the industry average of 17.4%. Since the same quarter one year prior, revenues slightly dropped by 4.1%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- HELEN OF TROY LTD has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has suffered a declining pattern of earnings per share over the past two years. However, we anticipate this trend to reverse over the coming year. During the past fiscal year, HELEN OF TROY LTD reported lower earnings of $2.67 versus $3.62 in the prior year. This year, the market expects an improvement in earnings ($4.38 versus $2.67).
- You can view the full analysis from the report here: HELE Ratings Report
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