Sally Beauty Reports Strong Q1 Results with 12% EPS Growth
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Feb 09 2026
0mins
Should l Buy SBH?
Source: Businesswire
Sally Beauty's stock fell 8.03% as it crossed below the 5-day SMA, reflecting a negative market reaction despite strong earnings results.
The company reported a 12% growth in adjusted EPS for Q1 2026, achieving $0.48, which beat estimates by $0.02. Additionally, Sally Beauty's revenue reached $943 million, surpassing expectations, and the company raised its full-year EPS guidance, indicating confidence in future performance. However, the stock's decline suggests sector rotation amid broader market weakness, as the Nasdaq-100 and S&P 500 both experienced losses today.
This performance highlights the company's strong operational metrics and strategic focus, but the market's reaction indicates that investors may be cautious about the retail environment and ongoing challenges in the sector.
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Analyst Views on SBH
Wall Street analysts forecast SBH stock price to rise
4 Analyst Rating
2 Buy
1 Hold
1 Sell
Hold
Current: 15.720
Low
13.00
Averages
15.88
High
19.00
Current: 15.720
Low
13.00
Averages
15.88
High
19.00
About SBH
Sally Beauty Holdings, Inc. is an international specialty retailer and distributor of professional beauty supplies. The Company operates in two business segments: Sally Beauty Supply and Beauty Systems Group, which offers beauty products in key categories, including hair care, hair color, styling tools and nails. Sally Beauty Supply is an omni-channel retailer that offers professional beauty supplies and provides education to retail consumers and salon professionals throughout North America, South America and Europe. Sally Beauty Supply stores offer up to 7,000 products for hair color, hair care, nails, and skin care through proprietary brands, such as Ion, Bondbar, Strawberry Leopard, and Generic Value Products. Beauty Systems Group stores, branded as Cosmo Prof or Armstrong McCall stores, along with its outside sales consultants, sell up to 8,000 professionally branded products, including Paul Mitchell, Wella, Matrix, Schwarzkopf, Kenra, Goldwell, Joico, Amika and Moroccanoil.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Dow Jones Decline: The Dow Jones Industrial Average fell slightly by 0.07% to 50,078.58, suggesting a relative weakness in traditional sectors, which may affect overall market sentiment.
- Sally Beauty Earnings Beat: Sally Beauty Holdings Inc (NYSE:SBH) reported an adjusted EPS of 48 cents for Q1, surpassing market expectations of 46 cents, with quarterly sales of $943.168 million exceeding the anticipated $940.150 million, demonstrating the company's resilience in a competitive market.
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- Strategic Transformation: The company exited lower-margin full-service operations in Europe, projected to create a $10 million sales headwind in 2026, but this strategic shift aims to simplify operations and focus on high-growth areas, enhancing overall profitability.
- Significant E-commerce Growth: Sally's global e-commerce sales grew by 20%, with U.S. and Canada e-commerce sales up 28%, indicating substantial progress in digital transformation and improved customer online shopping experiences.
- Optimistic Outlook: The company raised the low end of its full-year EPS guidance to $2.02 to $2.10, expecting Q2 sales between $895 million and $905 million, demonstrating management's confidence in future performance and positive market expectations.
See More
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- E-commerce Growth: Global e-commerce sales reached $111 million, accounting for 11.7% of net sales; while consolidated comparable sales remained flat, the growth in e-commerce supports future sales potential and reflects changing consumer shopping habits.
- Cash Flow Performance: The first quarter saw cash flow from operations of $93 million and free cash flow of $57 million, demonstrating strong cash flow performance that supports ongoing investments and shareholder returns, indicating a healthy financial position for the company.
- Fiscal Year 2026 Guidance: The company projects Q2 net sales between $895 million and $905 million, with adjusted EPS guidance of $0.39 to $0.42, reflecting confidence in future growth despite slight discrepancies with market consensus.
See More
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- Robust Cash Flow: As of December 31, 2025, the company reported $93 million in cash flow from operations and $57 million in free cash flow, enabling it to repay $20 million in term loan debt and repurchase 1.4 million shares, thereby increasing shareholder value.
- Optimized Inventory Management: The company's inventory stood at $979 million, down 2.7% year-over-year, demonstrating effective inventory management that helps improve operational efficiency and reduce capital lock-up.
- Ongoing Strategic Investments: The company continues to advance its strategic initiatives aimed at accelerating growth and enhancing profitability, which not only lays the groundwork for future market expansion but also creates long-term value for shareholders.
See More
