Sally Beauty (SBH) AI Stock Analysis

• Market Cap: $855.58M
• Dividend Yield: N/A
• Average Volume (3M): 1.75M
• Price to Earnings (P/E): 4.8
• Beta (1Y): 0.89
• Revenue Growth: 0.17%
• EPS Growth: 20.26%
• Country: US
• Employees: 12,000
• Sector: Consumer Cyclical
• Sector Strength: 58
• Industry: Specialty Retail
• EPS (TTM): 0.42
• Shares Outstanding: 100,894,226
• 10 Day Avg. Volume: 1,537,710
• 30 Day Avg. Volume: 1,751,435
• PEG Ratio: 0.76
• Price to Book (P/B): -29.53
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 8.38
• Enterprise Value/Market Cap: 3.54
• Enterprise Value/Revenue: 0.20
• Enterprise Value/Gross Profit: 1.60
• Enterprise Value/Ebitda: 1.92
• 1Y Price Target: $12.33
• Price Target Upside: 45.40% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3

• Rating: 69 Neutral
• Price Target: $9.50 ▲(12.03%Upside)

Sally Beauty's stock score is driven by a strong valuation indicating potential undervaluation, coupled with solid financial performance and strategic corporate actions like the share repurchase program. However, mixed technical signals and macroeconomic challenges affecting sales growth pose some risks.

Positive Factors

Cost Control

SBH maintains robust margins and cost control, delivering 20% EPS growth y/y despite uneven top line trends.

Operational Efficiency

Sally Beauty Holdings reported a better-than-expected Adj. EBIT margin of 8.5%, indicating strong operational efficiency.

Product Expansion

Sally Beauty is adding fast-growing prestige coloring brand Madison Reed to their assortment.

Negative Factors

Consumer Demand

Sales were pressured by weak start due to poor weather and increased illness rates, impacting consumer demand and the BSG business.

Economic Uncertainty

The dynamic tariff rate environment adds uncertainty to consumer confidence/spending.

Guidance Adjustment

Management lowered FY25 operating margin guidance and comps due to macro concerns, reflecting challenges in the economic environment.

Sally Beauty Business Overview & Revenue Model

Company Description

Sally Beauty Holdings, Inc. (SBH) is a leading international specialty retailer and distributor of professional beauty supplies. The company operates primarily through two business segments: Sally Beauty Supply and Beauty Systems Group. Sally Beauty Supply offers a wide range of professional-grade beauty products directly to consumers and salon professionals, including hair color, hair care, skin care, and nail products. Beauty Systems Group provides exclusive professional beauty products to licensed salon professionals and salon owners through its network of stores and direct sales consultants.

How the Company Makes Money

Sally Beauty Holdings generates revenue primarily through the sale of beauty products and supplies. The company's revenue streams are derived from its retail operations under the Sally Beauty Supply segment and distribution through the Beauty Systems Group segment. Sally Beauty Supply targets both retail consumers and professionals, selling products in physical stores and through e-commerce platforms. Beauty Systems Group focuses on exclusive distribution to licensed beauty professionals, offering products through professional-only stores and a dedicated sales force. Additionally, Sally Beauty may engage in strategic partnerships with beauty brands to enhance its product offerings and attract a broader customer base, further contributing to its revenue.

Sally Beauty Financial Statement Overview

Summary

Sally Beauty demonstrates strong profitability with a healthy gross profit margin and effective use of equity. Despite a slight revenue decline, stable operating efficiency and robust cash flow metrics provide a solid financial foundation.

Income Statement

Sally Beauty's income statement shows strong profitability with a healthy Gross Profit Margin of 51.3% and Net Profit Margin of 5.0% for TTM. However, revenue has shown a slight decline of 0.5% on an annual basis, which could be a concern if this trend continues. The EBIT Margin at 8.8% and EBITDA Margin at 10.2% indicate stable operating efficiency.

Balance Sheet

The balance sheet reflects a moderate risk profile with a Debt-to-Equity Ratio of 0.66 for TTM, indicating manageable leverage. The Return on Equity is strong at 26.6%, showcasing effective use of equity to generate profits. However, the Equity Ratio stands at 25.8%, suggesting a relatively lower proportion of equity financing.

Cash Flow

Cash flow metrics are stable with a Free Cash Flow Growth Rate of 14.5% and a robust Operating Cash Flow to Net Income Ratio of 1.3 in TTM, indicating good cash generation relative to earnings. The Free Cash Flow to Net Income Ratio is 0.9, reflecting solid cash profitability.

Breakdown
TTM	Sep 2024	Sep 2023	Sep 2022	Sep 2021	Sep 2020
Income Statement		Total Revenue
3.70B	3.72B	3.73B	3.82B	3.87B	3.51B
	Gross Profit
1.90B	1.89B	1.89B	1.92B	1.95B	1.72B
	EBIT
323.73M	282.73M	338.65M	265.29M	320.85M	166.01M
	EBITDA
378.45M	392.47M	441.06M	365.22M	423.05M	272.79M
	Net Income Common Stockholders
186.00M	153.41M	184.60M	183.55M	239.86M	113.25M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
92.17M	107.96M	123.00M	70.56M	400.96M	514.15M
	Total Assets
2.71B	2.79B	2.73B	2.58B	2.85B	2.90B
	Total Debt
461.35M	1.60B	1.68B	1.73B	1.94B	2.34B
	Net Debt
369.18M	1.49B	1.55B	1.66B	1.54B	1.83B
	Total Liabilities
2.01B	2.16B	2.22B	2.28B	2.57B	2.88B
	Stockholders Equity
699.82M	628.53M	508.75M	293.64M	280.74M	15.44M
Cash Flow		Free Cash Flow
166.50M	145.36M	158.57M	57.25M	307.96M	316.03M
	Operating Cash Flow
243.09M	246.53M	249.31M	156.50M	381.86M	426.89M
	Investing Cash Flow
-64.03M	-108.91M	-99.78M	-102.42M	-76.02M	-123.78M
	Financing Cash Flow
-84.80M	-153.73M	-100.82M	-373.68M	-419.97M	139.76M

Sally Beauty Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 8.48
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SBH, the sentiment is Negative. The current price of 8.48 is below the 20-day moving average (MA) of 8.91, below the 50-day MA of 8.56, and below the 200-day MA of 10.82, indicating a bearish trend. The MACD of 0.06 indicates Positive momentum. The RSI at 44.48 is Neutral, neither overbought nor oversold. The STOCH value of 43.19 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SBH.

Sally Beauty Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
LQDT	74 Outperform	$730.56M	29.67	14.01%	―	35.78%	23.49%
LZB	72 Outperform	$1.58B	13.12	12.40%	2.30%	1.81%	8.09%
WEYS	72 Outperform	$283.34M	9.75	11.76%	3.65%	-5.46%	-1.09%
SBH	69 Neutral	$855.58M	4.79	29.74%	―	0.17%	20.26%
Sector *	62 Neutral	$6.82B	11.05	2.80%	4.32%	2.67%	-24.92%
WGO	62 Neutral	$883.36M	―	-0.45%	4.31%	-12.29%	-105.55%
OLPX	54 Neutral	$839.06M	68.85	1.41%	―	-5.11%	-74.90%

Sally Beauty Corporate Events

Sally Beauty Reports Q2 2025 Financial Results

Sally Beauty Holdings reported its financial results for the second quarter of fiscal 2025, highlighting a third consecutive quarter of operating margin expansion despite a challenging macroeconomic environment. The company achieved a GAAP operating margin of 7.9% and an adjusted operating margin of 8.5%, supported by strong gross margin performance and cost control measures. Net sales decreased by 2.8% due to external factors, including unfavorable foreign currency impacts and reduced store operations. However, the company maintained strong cash flow, allowing for debt reduction and share repurchases. The Board of Directors approved a four-year extension to the share repurchase program, authorizing up to $501.1 million in stock repurchases.

The most recent analyst rating on (SBH) stock is a Buy with a $16.0000 price target. To see the full list of analyst forecasts on Sally Beauty stock, see the SBH Stock Forecast page.

Sally Beauty Extends Share Repurchase Program

Sally Beauty Holdings, Inc. announced on May 6, 2025, that its Board of Directors has approved an extension of the company’s share repurchase program until September 30, 2029. This extension allows the company to repurchase up to $501.1 million of its common stock, continuing its strategy to enhance shareholder value. The repurchases will comply with U.S. Securities and Exchange Commission rules, including Rule 10b-18, and may involve Rule 10b5-1 plans to facilitate purchases during restricted periods.

The most recent analyst rating on (SBH) stock is a Buy with a $16.0000 price target. To see the full list of analyst forecasts on Sally Beauty stock, see the SBH Stock Forecast page.