Helen of Troy Gears Up for Q4 Earnings: Key Factors to Note

Helen of Troy Limited HELE is likely to register both top and bottom-line declines when it reports fourth-quarter fiscal 2025 earnings on April 24. The Zacks Consensus Estimate for quarterly revenues is pegged at $481.9 million, implying a 1.5% decrease from the prior-year quarter’s reported figure. The consensus mark for fiscal 2025 top line is pegged at $1.9 billion, which indicates a decline of 5.1% from the year-ago level.

The Zacks Consensus Estimate for quarterly earnings has moved down by a penny in the past seven days to $2.34 per share, indicating a 4.5% decline from the figure reported in the year-ago quarter. The consensus mark for fiscal 2025 earnings is pegged at $7.20 per share, implying a 19.2% decrease from the prior year’s reported figure. 

HELE delivered a trailing four-quarter negative earnings surprise of 4.3%, on average. (Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.)

Helen of Troy Limited Price, Consensus and EPS Surprise

Helen of Troy Limited price-consensus-eps-surprise-chart | Helen of Troy Limited Quote

Factors Likely to Influence HELE’s Upcoming Results

Helen of Troy has been navigating a challenging macroeconomic environment characterized by reduced consumer and retailer demand. Consumers are facing financial constraints and prioritizing essential purchases over discretionary items. This has been impacting the company’s sales. Our model expects a 2.3% drop in organic volumes for the fiscal fourth quarter.

Helen of Troy’s Wellness segment is under pressure due to an unusually mild global illness season, with U.S. illness incidence at an eight-year low through December. This shift affected net sales by approximately $10 million in the fiscal third quarter and is expected to have hurt fiscal fourth-quarter sales by $15-$20 million. As a result, overall category performance is likely to have been under pressure in the to-be-reported quarter.

Helen of Troy has also been grappling with rising SG&A expenses. In the third quarter, the rise in the consolidated SG&A ratio was mainly due to elevated marketing expenses and unfavorable operating leverage. The persistence of any of these factors is a concern. Our model expects a 150-basis point expansion in adjusted SG&A (as a percentage of sales) to 33.8% for fiscal 2025.

Yet, the strength of Helen of Troy’s Leadership Brands continues to be a key pillar of support amid broader challenges. The company’s strategic focus on core operational excellence and portfolio refinement has helped stabilize performance. Its data-driven approach has been enhancing brand fundamentals, while international expansion and distribution optimization continue to drive reach and efficiency. Moreover, its global restructuring initiative, Project Pegasus, has been generating cost savings. These factors are likely to have offered some respite in the to-be-reported quarter’s performance.

Earnings Whispers for HELE

Our proven model does not conclusively predict an earnings beat for Helen of Troy this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here.

Helen of Troy currently has a Zacks Rank #4 (Sell) and an Earnings ESP of +0.57%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Some Stocks With the Favorable Combination

Here are some companies worth considering, as our model shows that these have the right combination of elements to beat on earnings this reporting cycle.

BJ's Wholesale Club Holdings, Inc. BJ currently has an Earnings ESP of +2.09% and a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for first quarter fiscal 2025 earnings per share (EPS) is pegged at 91 cents, which implies a 7.1% increase year over year. The consensus mark for BJ's Wholesale Club’s quarterly revenues is pegged at $5.2 billion, which indicates growth of 5.3% from the figure reported in the prior-year quarter. BJ delivered a trailing four-quarter earnings surprise of 12%, on average.

The Estée Lauder Companies Inc. EL currently has an Earnings ESP of +14.31% and a Zacks Rank of 3. The Zacks Consensus Estimate for third-quarter fiscal 2025 EPS is pegged at 30 cents, which implies a 69.1% decrease year over year.

The consensus mark for Estée Lauder Companies’ quarterly revenues is pegged at $3.5 billion, which indicates a 10.9% decrease from the figure reported in the prior-year quarter. EL delivered a trailing four-quarter earnings surprise of 101.9%, on average.

Freshpet, Inc. FRPT currently has an Earnings ESP of +2.56% and a Zacks Rank of 3. The Zacks Consensus Estimate for first quarter 2025 EPS is pegged at 13 cents, which implies a 38.1% decrease year over year.

The consensus mark for Freshpet’s quarterly revenues is pegged at $262.3 million, which indicates growth of 17.2% from the figure reported in the prior-year quarter. FRPT delivered a trailing four-quarter earnings surprise of 78.8%, on average.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research