Sally Beauty Holdings Beats Q2 Estimates and Earns Buy Upgrade at $13
Sally Beauty Holdings reported Q2 fiscal 2026 EPS of $0.44, beating estimates by $0.03, and revenue of $903.4m, up 2.3% year-over-year. Shares retreated to $13, prompting a Buy upgrade as analysts highlighted a 52.7% gross margin, P/E ratio of 6.85, earnings yield of 14.59% and net leverage at 1.5x.
1. Q2 Fiscal 2026 Performance
Sally Beauty Holdings delivered earnings per share of $0.44 for the quarter ending March 31, 2026, surpassing the prior-year’s $0.42 and consensus by $0.03, while revenue rose 2.3% year-over-year to $903.4 million.
2. Margin Expansion and Valuation
Gross margin improved to 52.7%, supported by efficient cost management, and the stock trades at a price-to-earnings ratio of 6.85 with an earnings yield of 14.59%.
3. Balance Sheet Strength
The company holds $157 million in cash with no revolver borrowings, maintains a debt-to-equity ratio of 0.63, a current ratio of 2.34, and net debt leverage of 1.5x, underlining robust liquidity.
4. Share Performance and Buy Upgrade
Shares retreated to $13, prompting a Buy upgrade in light of its attractive valuation and margin metrics.