NYSE:SBH

Stock Analysis Report

Sally Beauty Holdings

Executive Summary

Sally Beauty Holdings, Inc. operates as a specialty retailer and distributor of professional beauty supplies.


Snowflake Analysis

Solid track record and good value.


Similar Companies

Share Price & News

How has Sally Beauty Holdings's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: SBH's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

3.5%

SBH

22.1%

US Specialty Retail

9.9%

US Market


1 Year Return

-49.0%

SBH

-24.3%

US Specialty Retail

-11.9%

US Market

Return vs Industry: SBH underperformed the US Specialty Retail industry which returned -23.6% over the past year.

Return vs Market: SBH underperformed the US Market which returned -11.5% over the past year.


Shareholder returns

SBHIndustryMarket
7 Day3.5%22.1%9.9%
30 Day-24.6%-24.3%-15.0%
90 Day-48.3%-31.5%-21.5%
1 Year-49.0%-49.0%-23.1%-24.3%-10.0%-11.9%
3 Year-54.1%-54.1%-1.5%-6.3%12.3%5.1%
5 Year-72.7%-72.7%0.3%-7.8%32.5%18.1%

Price Volatility Vs. Market

How volatile is Sally Beauty Holdings's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Sally Beauty Holdings undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: SBH ($9.38) is trading below our estimate of fair value ($24.19)

Significantly Below Fair Value: SBH is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: SBH is good value based on its PE Ratio (4.3x) compared to the Specialty Retail industry average (8.5x).

PE vs Market: SBH is good value based on its PE Ratio (4.3x) compared to the US market (13x).


Price to Earnings Growth Ratio

PEG Ratio: SBH is poor value based on its PEG Ratio (1.6x)


Price to Book Ratio

PB vs Industry: SBH is overvalued based on its PB Ratio (495.5x) compared to the US Specialty Retail industry average (0.8x).


Next Steps

Future Growth

How is Sally Beauty Holdings forecast to perform in the next 1 to 3 years based on estimates from 9 analysts?

2.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: SBH's forecast earnings growth (2.7% per year) is above the savings rate (1.7%).

Earnings vs Market: SBH's earnings (2.7% per year) are forecast to grow slower than the US market (12.3% per year).

High Growth Earnings: SBH's earnings are forecast to grow, but not significantly.

Revenue vs Market: SBH's revenue (2.6% per year) is forecast to grow slower than the US market (7.3% per year).

High Growth Revenue: SBH's revenue (2.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: SBH's Return on Equity is forecast to be very high in 3 years time (343.6%).


Next Steps

Past Performance

How has Sally Beauty Holdings performed over the past 5 years?

2.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: SBH has high quality earnings.

Growing Profit Margin: SBH's current net profit margins (6.7%) are higher than last year (6.1%).


Past Earnings Growth Analysis

Earnings Trend: SBH's earnings have grown by 2.2% per year over the past 5 years.

Accelerating Growth: SBH's earnings growth over the past year (7.7%) exceeds its 5-year average (2.2% per year).

Earnings vs Industry: SBH earnings growth over the past year (7.7%) exceeded the Specialty Retail industry 6.9%.


Return on Equity

High ROE: Whilst SBH's Return on Equity (11783.13%) is outstanding, this metric is skewed due to their high level of debt.


Next Steps

Financial Health

How is Sally Beauty Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: SBH's short term assets ($1.2B) exceed its short term liabilities ($594.6M).

Long Term Liabilities: SBH's short term assets ($1.2B) do not cover its long term liabilities ($2.1B).


Debt to Equity History and Analysis

Debt Level: SBH's debt to equity ratio (71779.7%) is considered high.

Reducing Debt: SBH had negative shareholder equity 5 years ago, but is now positive and has therefore improved.

Debt Coverage: SBH's debt is well covered by operating cash flow (21.1%).

Interest Coverage: SBH's interest payments on its debt are well covered by EBIT (4.7x coverage).


Balance Sheet

Inventory Level: SBH has a high level of physical assets or inventory.

Debt Coverage by Assets: SBH's debt is not covered by short term assets (assets are 0.8x debt).


Next Steps

Dividend

What is Sally Beauty Holdings's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

Notable Dividend: Unable to evaluate SBH's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate SBH's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if SBH's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if SBH's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of SBH's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

2.2yrs

Average management tenure


CEO

Chris Brickman (54yo)

5s

Tenure

US$5,851,864

Compensation

Mr. Christian A. Brickman, also known as Chris, has been the Chief Executive Officer at Sally Beauty Holdings Inc. since February 1, 2015 and has been its President since June 2, 2014. Mr. Brickman has bee ...


CEO Compensation Analysis

Compensation vs Market: Chris's total compensation ($USD5.85M) is above average for companies of similar size in the US market ($USD3.12M).

Compensation vs Earnings: Chris's compensation has increased by more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Christian Brickman
President5yrsUS$5.85m0.38% $4.1m
Aaron Alt
Senior VP1.83yrsUS$2.21m0.092% $1.0m
John Henrich
Senior VP2.17yrsUS$680.09k0.012% $133.2k
Scott Sherman
Senior VP & Chief Human Resources Officer2.42yrsUS$1.01m0.018% $196.5k
Mark Spinks
President of Beauty Systems Group LLC4.67yrsUS$1.28m0.027% $289.5k
Kenneth Newton
Interim Controller & Interim Principal Accounting Officer0.42yrno data0.0044% $47.8k
Joe Brenner
Chief Information Officer1.42yrsno datano data
Jeff Harkins
Vice President of Investor Relations & Strategic Planningno datano datano data
Pamela Kohn
Senior VP & Chief Merchandising Officer0.42yrno data0.031% $338.4k
Olivier Badezet
Senior VP & MD of Europe3.17yrsno datano data

2.2yrs

Average Tenure

52yo

Average Age

Experienced Management: SBH's management team is considered experienced (2.2 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Christian Brickman
President5yrsUS$5.85m0.38% $4.1m
John Miller
Independent Director13.33yrsUS$235.99k0.051% $558.9k
Diana Ferguson
Independent Director1.17yrsUS$149.86k0.0047% $50.8k
Marshall Eisenberg
Independent Director13.33yrsUS$293.99k0.071% $769.8k
Robert McMaster
Non-Executive Chairman of the Board4.08yrsUS$562.00k0.058% $635.7k
Edward Rabin
Independent Director13.33yrsUS$257.99k0.13% $1.4m
Timothy Baer
Independent Director0.17yrno datano data
P. Kelly Mooney
Independent Director1.58yrsUS$237.99k0.0073% $79.1k
Susan Mulder
Independent Director5.33yrsUS$242.99k0.0039% $42.9k
Denise Paulonis
Independent Director1.83yrsUS$230.99k0.0091% $99.6k

4.7yrs

Average Tenure

56.5yo

Average Age

Experienced Board: SBH's board of directors are considered experienced (4.7 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: SBH insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Sally Beauty Holdings, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Sally Beauty Holdings, Inc.
  • Ticker: SBH
  • Exchange: NYSE
  • Founded: 1964
  • Industry: Specialty Stores
  • Sector: Retail
  • Market Cap: US$1.090b
  • Shares outstanding: 116.19m
  • Website: https://www.sallybeautyholdings.com

Number of Employees


Location

  • Sally Beauty Holdings, Inc.
  • 3001 Colorado Boulevard
  • Denton
  • Texas
  • 76210
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
SBHNYSE (New York Stock Exchange)YesCommon StockUSUSDNov 2006
S7VDB (Deutsche Boerse AG)YesCommon StockDEEURNov 2006
S7VBRSE (Berne Stock Exchange)YesCommon StockCHCHFNov 2006

Biography

Sally Beauty Holdings, Inc. operates as a specialty retailer and distributor of professional beauty supplies. The company operates through two segments, Sally Beauty Supply and Beauty Systems Group. The Sally Beauty Supply segment offers beauty products, including hair color and care, skin and nail care, styling tools, and other beauty products for retail customers and salon professionals. This segment also provides products under third-party brands, such as Wella, Clairol, OPI, Conair, and Hot Shot Tools, as well as exclusive-label brand merchandise. The Beauty Systems Group segment offers professional beauty products, such as hair color and care, skin and nail care, styling tools, and other beauty items directly to salons and salon professionals through its professional-only stores, e-commerce Websites, and sales force, as well as through franchised stores under the Armstrong McCall store names. This segment also sells products under third-party brands, such as Paul Mitchell, Wella, Matrix, Schwarzkopf, Kenra, Goldwell, Joico, and Chi. As of November 18, 2019, the company operated 5,061 stores, including 159 franchised units in the United States, Puerto Rico, Canada, Mexico, Chile, Peru, the United Kingdom, Ireland, Belgium, France, the Netherlands, Spain, and Germany. It also distributes its products through full-service/exclusive distributors, open-line distributors, direct sales, and mega-salon stores. Sally Beauty Holdings, Inc. was founded in 1964 and is headquartered in Denton, Texas. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/03/29 02:11
End of Day Share Price2020/03/27 00:00
Earnings2019/12/31
Annual Earnings2019/09/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.