Helen Of Troy Ltd (NASDAQ: HELE)

Sector: Consumer Defensive Industry: Household & Personal Products CIK: 0000916789
Market Cap 468.98 Mn
P/B 0.51
P/E -0.71
P/S 0.26
ROIC (Qtr) -30.23
Div Yield % 0.00
Rev 1y % (Qtr) -8.95
Total Debt (Qtr) 932.68 Mn
Debt/Equity (Qtr) 1.01

About

Helen of Troy Limited (HELE) is a global consumer products company that operates in two primary segments: Home & Outdoor and Beauty & Wellness. Established in Texas in 1968, the company reorganized and became Helen of Troy Limited in Bermuda in 1994. HELE offers an array of creative products and solutions for its customers through a diverse portfolio of brands. The company's main business activities revolve around the design, production, and distribution of a wide range of products. These offerings cater to consumers' everyday needs, both inside...

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Price action

Investment thesis

Bull case

  • Robust tangible asset base of 1.41B provides 3.63x coverage of working capital 388.18M, indicating strong operational backing.
  • Operating cash flow of 91.17M fully covers other non-current liabilities 20.52M by 4.44x, showing strong long-term stability.
  • Tangible assets of 1.41B provide robust 5.75x coverage of other current liabilities 244.92M, indicating strong asset backing.
  • Retained earnings of 552.41M represent substantial 0.60x of equity 926.28M, indicating strong internal capital generation.
  • Cash reserves of 22.37M provide solid 1.09x coverage of other non-current liabilities 20.52M, indicating strong liquidity.

Bear case

  • Operating cash flow of 91.17M barely covers its investment activities of (269.97M), with a coverage ratio of -0.34, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • With cash reserves of 22.37M against inventory of 528.89M, the 0.04 cash-to-inventory ratio suggests potential liquidity risks if inventory turnover slows, particularly concerning given current supply chain volatilities.
  • Cash reserves of 22.37M provide limited coverage of acquisition spending of (225.55M), which is -0.10x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • The company's operating cash flow of 91.17M shows concerning coverage of stock compensation expenses of 19.72M, with a 4.62 ratio indicating potential earnings quality issues.
  • Operating earnings of (644.50M) show weak coverage of depreciation charges of 63.96M, with a -10.08 ratio indicating high capital intensity and potential reinvestment needs.

Peer comparison

Companies in the Household & Personal Products
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 PG PROCTER & GAMBLE Co 344.56 Bn 20.55 4.06 35.95 Bn
2 UL Unilever Plc 162.92 Bn 24.93 2.32 -
3 CL Colgate Palmolive Co 64.98 Bn 22.35 3.23 8.42 Bn
4 EL Estee Lauder Companies Inc 38.59 Bn -41.50 2.67 9.42 Bn
5 KMB Kimberly Clark Corp 33.56 Bn 17.05 1.86 7.30 Bn
6 KVUE Kenvue Inc. 32.45 Bn 22.64 2.16 8.97 Bn
7 CHD Church & Dwight Co Inc /De/ 20.90 Bn 26.71 3.40 2.20 Bn
8 CLX Clorox Co /De/ 12.14 Bn 15.35 1.79 3.08 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.56 1.45
EV to Cash from Ops. EV/CFO 14.90 8.11
EV to Debt EV to Debt 1.46 4.77
EV to EBIT EV/EBIT -2.11 14.54
EV to EBITDA EV/EBITDA -2.34 7.35
EV to Free Cash Flow [EV/FCF] EV/FCF 26.89 2.98
EV to Market Cap EV to Market Cap 2.90 -1.59
EV to Revenue EV/Rev 0.75 2.00
Price to Book Value [P/B] P/B 0.51 -7.69
Price to Earnings [P/E] P/E -0.71 16.46
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 9.11
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 12.82
Dividend per Basic Share Div per Share (Qtr) 0.00 0.92
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 11.25
Interest Coverage Int. cover (Qtr) -11.89 2.65
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -41.63 -96.96
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 11.09 2.29
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 -2.46
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -437.26 -142.06
EBITDA Growth (1y) % EBITDA 1y % (Qtr) -290.50 -154.15
EBIT Growth (1y) % EBIT 1y % (Qtr) -368.29 -155.18
EBT Growth (1y) % EBT 1y % (Qtr) -469.48 -206.88
EPS Growth (1y) % EPS 1y % (Qtr) -578.33 -158.13
FCF Growth (1y) % FCF 1y % (Qtr) -73.35 -5.66
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) -6.67 -1.42
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.76 0.82
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.19
Cash Ratio Cash Ratio (Qtr) 0.04 0.76
Current Ratio Curr Ratio (Qtr) 1.71 2.31
Debt to Equity Ratio Debt/Equity (Qtr) 1.01 -2.80
Interest Cover Ratio Int Coverage (Qtr) -11.89 2.65
Times Interest Earned Times Interest Earned (Qtr) -11.89 2.65
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) -31.90 -32.28
EBIT Margin % EBIT Margin % (Qtr) -35.41 -37.76
EBT Margin % EBT Margin % (Qtr) -38.39 -40.89
Gross Margin % Gross Margin % (Qtr) 47.30 50.05
Net Profit Margin % Net Margin % (Qtr) -36.20 -42.94