Research from Water Tower Research, Water Tower Research

Water Tower Research

Research from Water Tower Research

Water Tower Research is a leading equity research firm that provides research on micro, small and mid cap companies.

Water Tower Research was founded by Wall Street veterans after witnessing a fundamental shift in the investment research industry with the result being a declining knowledge base among investors, a lack of awareness and a shrinking pool of fundamental research being conducted on companies across the small-cap and micro-cap spectrum. The same issues are now increasingly occurring in the mid-cap space. This sea change within the investment community is impacting not only the companies themselves but also current shareholders and potential investors. With significantly less active sell-side sponsorship by Wall Street, a substantial information gap has developed between companies and various constituents in the financial community. The net result is fewer channels for insight and information to flow between companies and investors.

Equity Research Firm

Equity Bottom-Up

Prestige Brands Holdings, Inc / Equity Bottom-Up

<div><ul><li>PBH reported 2QFY26 adjusted EPS of $1.07 versus $1.09 in 2QFY25, above our $0.97 estimate, which was also FactSet consensus.</li><li>Sales in the quarter declined 3.4% Y/Y to $274.1MM, above our $256.9MM estimate, as well as consensus of $257.1MM.</li><li>Management previously expected sales in the range of $256-259MM, so sales exceeded management’s original expectations as well. </li></ul></div>

PBH reported 2QFY26 adjusted EPS of $1.07 versus $1.09 in 2QFY25, above our $0.97 estimate, which was also FactSet consensus.Sales in the quarter declined 3.4% Y/Y to $274.1MM, above our $256.9MM estimate, as well as consensus of $257.1MM.Management previously expected sales in the range of $256-259MM, so sales exceeded management’s original expectations as well. 

PBH: Demand Pull-Forward Drives 2QFY26 Upside; Raising EPS Estimates Due to Strong Free Cash Flow

<ul><li>PBH reported 1QFY26 adjusted EPS of $0.95 versus $0.90 in 1QFY25, up 5.6% Y/Y, but below our $1.04 estimate and FactSet consensus of $1.00.</li><li>This is also below management’s expected range of $0.98-1.00 given in May.</li><li>Sales in the quarter decreased 6.6% to $249.5MM, below our $267.2MM estimate and consensus of $260.8MM, as well as management’s expected range of $258-260MM.</li></ul>

PBH reported 1QFY26 adjusted EPS of $0.95 versus $0.90 in 1QFY25, up 5.6% Y/Y, but below our $1.04 estimate and FactSet consensus of $1.00.This is also below management’s expected range of $0.98-1.00 given in May.Sales in the quarter decreased 6.6% to $249.5MM, below our $267.2MM estimate and consensus of $260.8MM, as well as management’s expected range of $258-260MM.

Prestige Consumer Healthcare, Inc: 1QFY26 Results Light on Clear Eyes Supply Constraints

<ul><li>We are initiating coverage of Prestige Consumer Healthcare, Inc. (PBH), a leading provider of over-the-counter (OTC) health and personal care products.</li><li>Our initial FY25 EPS estimate is $4.50, up 6.7% from $4.21 in FY24.</li><li>This is in line with consensus of $4.50 and management guidance of $4.50. Our FY26 EPS estimate is $4.80 (up 6.9%) and slightly above consensus of $4.79.</li></ul>

We are initiating coverage of Prestige Consumer Healthcare, Inc. (PBH), a leading provider of over-the-counter (OTC) health and personal care products.Our initial FY25 EPS estimate is $4.50, up 6.7% from $4.21 in FY24.This is in line with consensus of $4.50 and management guidance of $4.50. Our FY26 EPS estimate is $4.80 (up 6.9%) and slightly above consensus of $4.79.

Prestige Consumer Healthcare, Inc. - Initiating Coverage

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

<ul>
<li>Last week we discussed potential for a 2-5% rally to the 1.5-month downtrend on SPX, or even the 4165-4200 range, which would set up an opportunity to get more defensive.</li>
<li>As long as the S&amp;P 500 is below Wednesdays high of 4040 we continue to believe the bears are in control -- stay defensive.</li>
<li>Even if there is a reversal, we still expect 4165-4200 on SPX to cap upside for 2023. We highlight many buy opportunities within Consumer Staples</li>
</ul>


Last week we discussed potential for a 2-5% rally to the 1.5-month downtrend on SPX, or even the 4165-4200 range, which would set up an opportunity to get more defensive.
As long as the S&amp;P 500 is below Wednesdays high of 4040 we continue to believe the bears are in control -- stay defensive.
Even if there is a reversal, we still expect 4165-4200 on SPX to cap upside for 2023. We highlight many buy opportunities within Consumer Staples


S&P 500, Nasdaq 100, DJIA All Testing Resistance; Downgrading Financials to Underweight; Buy Staples

<p>Now that the initial/primary low has been established and with the S&amp;P 500 roughly 20% off the lows, we believe it is time to map out potential areas where this rally could run into resistance. After this type of major waterfall decline there is often a test of the initial low - and there is often an undercut of the initial low. Barring approval of a first-line therapy for COVID-19 (chloroquine/hydroxychloroquine?) we are of the belief that a test of this initial low (likely 2-12 weeks out) and potentially an undercut of roughly 10% are likely.</p>

Now that the initial/primary low has been established and with the S&amp;P 500 roughly 20% off the lows, we believe it is time to map out potential areas where this rally could run into resistance. After this type of major waterfall decline there is often a test of the initial low - and there is often an undercut of the initial low. Barring approval of a first-line therapy for COVID-19 (chloroquine/hydroxychloroquine?) we are of the belief that a test of this initial low (likely 2-12 weeks out) and potentially an undercut of roughly 10% are likely.

United States

Prestige Brands Holdings, Inc. distributes over-the-counter healthcare and household cleaning products to retail stores in the United States, Canada and other international markets.  The Company distributes oral, eye and skin care; cough, cold, allergy and sinus; and household cleansers, sponges, scrubbers and cleaning pads.

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Prestige Brands Holdings, Inc (PBH US)

PBH: Demand Pull-Forward Drives 2QFY26 Upside; Raising EPS Estimates Due to Strong Free Cash Flow

PBH reported 2QFY26 adjusted EPS of $1.07 versus $1.09 in 2QFY25, above our $0.97 estimate, which was also FactSet consensus.

Water Tower Research

Prestige Consumer Healthcare, Inc: 1QFY26 Results Light on Clear Eyes Supply Constraints

PBH reported 1QFY26 adjusted EPS of $0.95 versus $0.90 in 1QFY25, up 5.6% Y/Y, but below our $1.04 estimate and FactSet consensus of $1.00.

Water Tower Research

Prestige Consumer Healthcare, Inc. - Initiating Coverage

We are initiating coverage of Prestige Consumer Healthcare, Inc. (PBH), a leading provider of over-the-counter (OTC) health and personal care...

Water Tower Research

S&P 500, Nasdaq 100, DJIA All Testing Resistance; Downgrading Financials to Underweight; Buy Staples

Last week (3/21) we discussed the potential for a 2-5% rally to the 1.5-month downtrend on the $SPX, or even the 4165-4200 range, which we noted...

Vermilion Research

U.S. Equities: Test Of The Lows Coming?

Now that the initial/primary low has been established and with the S&P 500 roughly 20% off the lows, we believe it is time to map out potential...

Vermilion Research

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