Prestige Consumer Healthcare Inc. PBH has been benefiting from the strength of its brands and e-commerce growth. On its first-quarter earnings call, the company reiterated its guidance for fiscal 2023, even amid a dynamic supply-chain and inflationary scenario, due to its solid portfolio and three-pillar business strategy. These include brand building, maintaining a robust financial status and optimizing capital allocation.

Let’s delve deeper into the factors acting as upsides for this Zacks Rank #2 (Buy) company.

Factors Working Well for Prestige Consumer

Prestige Consumer prides on having a strong portfolio of healthcare brands. It has been focused on areas with greater growth potential. The company has undertaken several lucrative acquisitions to boost its portfolio. It acquired TheraTears and four other over-the-counter consumer brands across the VMS and Cough & Cold categories from Akorn Operating Company LLC. This buyout, concluded in July 2021, contributed to Prestige Consumer’s first-quarter fiscal 2023 results. TheraTears’ and Clear Eyes’ prospects in the long term look encouraging. These have helped enhance Prestige Consumer’s footing in the eye care space.

Prestige Consumer Healthcare Inc. Price, Consensus and EPS Surprise

Prestige Consumer Healthcare Inc. price-consensus-eps-surprise-chart | Prestige Consumer Healthcare Inc. Quote

The company has been making multi-year e-commerce investments for a while now. The company’s e-commerce sales approached 50% of the company’s sales (as of the end of fiscal 2022). In the first quarter of fiscal 2023, e-commerce sales continued to register double-digit growth on a year-over-year basis due to increased online shopping. With more consumers shifting to the online mode of shopping, the e-commerce channel is likely to remain strong, and Prestige Consumer’s investments in this arena are likely to keep the company well-placed.

A Look at Q1 & Ahead

Prestige Consumer Healthcare posted first-quarter fiscal 2023 results, wherein the top and bottom lines beat the respective Zacks Consensus Estimate and the former increased year over year. Prestige Consumer continued to benefit from its vast brand portfolio and solid business strategy.

Total revenues grew 2.9% to $277.1 million and beat the Zacks Consensus Estimate of $268 million. Excluding currency impacts and contributions from the Akorn buyout, revenues fell 1.2%. Revenues were backed by strength in key brands, partly negated by tough comparisons with the year-ago period that witnessed considerably high demand across certain categories, brands and channels, which were earlier hurt by the pandemic.

For fiscal 2023, Prestige Consumer anticipates revenues in the range of $1,120-$1,130 million compared with the $1,086.8 million reported in fiscal 2022. Management anticipates organic sales growth in the range of 2-3% in fiscal 2023.  Also, the company envisions adjusted earnings per share in the band of $4.18-$4.23 compared with the $4.06 recorded in fiscal 2022.

All said, Prestige Consumer appears well-placed for growth.

Other Consumer Discretionary Stocks Worth a Look

Some other top-ranked stocks are BJ's Wholesale Club BJ, Hyatt Hotels H and Marriott International MAR.

BJ's Wholesale, which operates warehouse clubs, currently sports a Zacks Rank #1 (Strong Buy). BJ has a trailing four-quarter earnings surprise of 16.5%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for BJ's Wholesale current financial-year sales suggests growth of around 15% from the year-ago reported number.

Hyatt, which operates as a hospitality company, currently carries a Zacks Rank of 2. H has a trailing four-quarter earnings surprise of 798.8%, on average.

The Zacks Consensus Estimate for Hyatt’s current financial-year sales suggests growth of 89.1% from the corresponding year-ago reported figure.

Marriott International, which operates, franchises and licenses hotel, residential and timeshare properties, carries a Zacks Rank #2 at present. Marriott International delivered an earnings surprise of 18.6% in the last reported quarter.
 
The Zacks Consensus Estimate for MAR’s current financial-year sales suggests growth of 46.1% from the year-ago period’s reported figure.

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