After the release of preliminary results from the second quarter of Sally Beauty Holdings (SBH) fiscal year 2021, shares of the cosmetic retailer gained more than 20% on May 6 in trading. A clear recovery in the retail network for the retail network is the main news of the message, not the growing sales.
According to preliminary sales data, profits in the second quarter are expected to grow by 6.3 %. Comparable sales for the Sally Beauty product line are forecasted to increase 6.5 % on an annual basis. Sales have grown 56 % in the e-commerce segment during the coronavirus and changes in store opening hours, as most retailers have. The preliminary report for the third quarter showed adjusted earnings of $ 0.57 per share, up 148% from a year ago and above Wall Street expectations. During the second quarter, the retailer was able to see an increase in demand in almost all of its product groups.
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Investors’ positive response is not related to current sales but signs of recovery because Sally Beauty’s performance alone can cause optimism. With continued vaccinations and approval for economic aid, the American economy is beginning to recover. Social activity will increase due to the partial lifting of restrictions, which plays a positive role. As a result, the demand for beauty products is expected to increase. Sally Beauty, a retailer of hair and nail care products, is expected to maintain momentum for the next few quarters.
Shares of Sally Beauty Holdings (SBH) have dropped -0.49% to $24.2 in Thursday’s aftermarket. The stock of Sally Beauty Holdings Inc. gained 20.04% in the last trading session to close at $24.32. There was a trading volume of 8.05 million shares below the average daily trading volume of 1.61 million shares over the last 50 days. However, the stock price of Sally Beauty Holdings Inc. has earned 23.08% in the last month despite making a 19.63% advance during the past five days. During the last three months, the stock price has gained 55.20% and has gained 86.50 percent for the year. Additionally, the price-to-earnings ratio of the stock is 23.57. Its price to cash flow ratio is 8.74, while its price to sales ratio is 0.80.
