Financial News

The Honest Company (HNST) Q3 Earnings Report Preview: What To Look For

HNST Cover Image

Personal care company The Honest Company (NASDAQ:HNST) will be reporting earnings tomorrow after the bell. Here’s what investors should know.

The Honest Company beat analysts’ revenue expectations by 6.8% last quarter, reporting revenues of $93.05 million, up 10.1% year on year. It was an exceptional quarter for the company, with an impressive beat of analysts’ earnings and gross margin estimates.

Is The Honest Company a buy or sell going into earnings? Read our full analysis here, it’s free.

This quarter, analysts are expecting The Honest Company’s revenue to grow 7.7% year on year to $92.8 million, improving from the 1.9% increase it recorded in the same quarter last year. Adjusted loss is expected to come in at -$0.05 per share.

The Honest Company Total Revenue

The majority of analysts covering the company have reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. The Honest Company has a history of exceeding Wall Street’s expectations, beating revenue estimates every single time over the past two years by 5.9% on average.

Looking at The Honest Company’s peers in the personal care segment, some have already reported their Q3 results, giving us a hint as to what we can expect. e.l.f. delivered year-on-year revenue growth of 39.7%, beating analysts’ expectations by 4%, and Herbalife reported a revenue decline of 3.2%, falling short of estimates by 1%. e.l.f. traded up 11.5% following the results while Herbalife was also up 10.2%.

Read our full analysis of e.l.f.’s results here and Herbalife’s results here.

Investors in the personal care segment have had steady hands going into earnings, with share prices flat over the last month. The Honest Company is up 18.3% during the same time and is heading into earnings with an average analyst price target of $5.39 (compared to the current share price of $4.40).

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