You've got to love earnings season. As a value investor, although I tend not to focus too much on one quarter's results, but it can still be an exciting time, especially in Smallville. Yesterday the floodgates opened, and there were a handful of interesting results among underfollowed names.
Sally Beauty Holdings (SBH) , a member of my 2021 Tax Loss Selling Recovery Portfolio, reported much better-than-expected second quarter earnings of 57 cents, well ahead of the 15 cent consensus estimate. Revenue of $926 million beat the consensus by $101 million. Same store sales rose 6.5%, while global e-commerce sales jumped 56%. SBH also made some headway on its debt, reducing it from about $1.8 billion at the end of Q4 to just under $1.6 billion as of the end of Q1. The company ended the quarter with $408 million in cash. Based on Wednesday's closing price, shares trade at about 10.5x next year's consensus estimates.
Falcon Minerals (FLMN) , another constituent of the Tax Loss Selling Recovery Portfolio, reported a first quarter loss of -3 cents/share, missing the positive 3 cent consensus. While revenue of $12.5 million came in $800K higher than consensus, there was some bigger news that may drive shares higher today. FLMN raised its quarterly dividend 33% to 10 cents, putting the indicated yield at 8.5%. Shares trade at about 14x next year's consensus estimates.
Finally, the ever-mysterious NL Industries (NL) reported first quarter earnings of 27 cents/share. How did that compare to the consensus you might ask? Well, there is no consensus for NL, no analysts currently cover the name, which owns pieces of three publicly traded names including CompX International (CIX) , Kronos Worldwide (KRO) , and Valhi (VHI) . NL ended the quarter with $135 million or $2.76/share in cash and $500K in debt, and yields 3.1%. NL remains a misunderstood, and complicated sum-of-the parts story, but one that has been performing quite well over the past year.
Can't wait to see what today brings!
