Quarterly earnings results are an excellent opportunity to assess a company’s progress, particularly when compared to its peers in the same sector. Today, we will delve into Sally Beauty (NYSE:SBH) and the top performers and underachievers among specialty retail stocks.
What Are Specialty Retailers?
While some retailers attempt to sell a wide variety of products, specialty retailers focus on a specific category and strive to excel in that area. Whether it’s eyeglasses, sporting goods, or beauty and cosmetics, these stores stand out due to their depth of product offerings and expertise provided to shoppers.
E-commerce Competition and Retail Foot Traffic
Specialty retailers face significant challenges from e-commerce competition and waning retail foot traffic. However, the magnitude of these headwinds depends on what products they sell and the value they provide in-store.
The 8 Specialty Retail Stocks We Track
As a group, these companies reported satisfactory Q3 results. Their revenues exceeded analysts’ consensus estimates by 0.5%, while next quarter’s revenue guidance was in line.
Fortunately, share prices of these companies have been resilient, with an average increase of 5.5% since the latest earnings results.
Sally Beauty (NYSE:SBH)
Sally Beauty is a retailer that caters to both everyday consumers and salon professionals, offering salon-quality beauty products such as makeup and haircare items.
In Q3, Sally Beauty reported revenues of $935 million, up 1.5% year-over-year. This print was in line with analysts’ expectations, making it a satisfactory quarter for the company.
"We are pleased to conclude our fiscal year with strong fourth-quarter results, reflecting continued momentum across both our Sally Beauty and Beauty Systems Group segments," said Denise Paulonis, president and chief executive officer of Sally Beauty.
Sally Beauty Total Revenue
As expected, the stock is down 15.3% since reporting and currently trades at $10.61.
Is now the time to buy Sally Beauty?
Access our full analysis of the earnings results here (free).
Best Q3: Sportsman’s Warehouse (NASDAQ:SPWH)
Sportsman’s Warehouse, an American specialty retailer offering a diverse range of active gear, equipment, and apparel for hunting, fishing, camping, hiking, shooting sports, and more.
In Q3, Sportsman’s Warehouse reported revenues of $324.3 million, down 4.8% year-over-year. However, this number exceeded analysts’ expectations by 7.9%.
The business achieved the biggest analyst estimates beat and highest full-year guidance raise among its peers.
However, the results were likely priced into the stock as it’s traded sideways since reporting. The current price is $36.60.
Access our full report on Sportsman’s Warehouse here (free).
Bath and Body Works (NYSE:BBY)
With humble beginnings as a stereo equipment seller, Best Buy now offers a broad selection of consumer electronics, appliances, and home office products.
In Q3, Best Buy reported revenues of $9.45 billion, down 3.2% year-over-year. This number came in 2% below analysts’ expectations.
The company also logged a miss of analysts’ EBITDA estimates and full-year EPS guidance missing analysts’ expectations.
The stock is down 9.4% since reporting and currently trades at $84.27.
Access our full report on Best Buy here (free).
Market Update
Thanks to the Fed’s series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal.
This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market has thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% each in November and December), and a notable surge followed Donald Trump’s presidential election win in November, propelling indices to historic highs.
However, the outlook for 2025 remains clouded by the pace and magnitude of future rate cuts as well as potential changes in trade policy and corporate taxes once the Trump administration takes over.
The path forward is marked by uncertainty.
Want to invest in winners with rock-solid fundamentals? Check out our Top 5 Growth Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
Join Paid Stock Investor Research
Help us make StockStory more helpful to investors like yourself. Join our paid user research session and receive a $50 Amazon gift card for your opinions.
Sign up here.
View Comments