Value
7.5/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 8.5 |
| P/S | 8.9 |
| EV/EBITDA | 6.0 |
| Fwd P/E | 9.3 |
| PEG | 5.2 |
| Analyst target | 7.5 |
- ▸Forward P/E: 9.7x
- ▸PEG: 1.46
- ▸Attractively valued
PBH · Why this verdict
Why Prestige Consumer Healthcare In (PBH) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.1/10
ConfidenceMEDIUM
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
At a forward P/E of 9.3x and analyst upside of 25% to roughly $58, Prestige Consumer Healthcare offers an attractive entry price relative to its 17% operating margin and 8/9 Piotroski F-Score, suggesting the market is overly penalizing the earnings miss streak. Valuation breakdown | Price rises above $55 within 12 months as the valuation discount is recognized once the earnings miss streak ends. | →Stable |
| CounterFour consecutive earnings misses averaging negative 7% surprise, combined with declining revenue of 5% year over year, suggest estimates are still too high rather than the stock being undervalued. | ||
Despite four consecutive earnings misses, Prestige Consumer Healthcare maintains strong operating margins at 17% with free cash flow at 71% of net income and a Piotroski F-Score of 8/9, indicating the business quality floor is intact. Quality breakdown | Operating margin stays above 14% for at least 3 of the next 4 quarters, confirming the margin floor holds despite revenue pressure. | →Stable |
| CounterRevenue has declined 5% year over year and earnings estimates are trending downward; margin compression typically follows revenue decline in consumer healthcare as fixed overhead becomes a larger proportion of a shrinking sales base. | ||
The four consecutive earnings misses averaging negative 7% have already reset expectations significantly lower; the risk of a positive EPS surprise grows as estimates converge toward the true earnings run rate. Earnings | Earnings beat consensus by more than 3% in at least 1 of the next 2 quarters, signaling the miss streak is ending. | →Stable |
| CounterEstimates trending downward means the market is still adjusting expectations lower; a company that misses by 11.5% and then 11.3% in consecutive quarters may still not have reached bottom estimates. | ||
Despite the confirmed death cross and downtrend, the MACD has improved to a score of 10 — the highest possible reading — suggesting a technical inflection may be forming even as price remains below key moving averages. Momentum breakdown | Price crosses above the 200-day moving average within 9 months and sustains above that level for at least 20 consecutive trading days. | →Stable |
| CounterMACD improvement in a stock with four consecutive earnings misses and declining revenue is unreliable as a fundamental inflection signal; the price remains near 52-week lows at only 0.4% above the annual trough. | ||
At a forward P/E of 9.3x and analyst upside of 25% to roughly $58, Prestige Consumer Healthcare offers an attractive entry price relative to its 17% operating margin and 8/9 Piotroski F-Score, suggesting the market is overly penalizing the earnings miss streak.
→StableValuation breakdown
- Expectation
- Price rises above $55 within 12 months as the valuation discount is recognized once the earnings miss streak ends.
CounterFour consecutive earnings misses averaging negative 7% surprise, combined with declining revenue of 5% year over year, suggest estimates are still too high rather than the stock being undervalued.
Despite four consecutive earnings misses, Prestige Consumer Healthcare maintains strong operating margins at 17% with free cash flow at 71% of net income and a Piotroski F-Score of 8/9, indicating the business quality floor is intact.
→StableQuality breakdown
- Expectation
- Operating margin stays above 14% for at least 3 of the next 4 quarters, confirming the margin floor holds despite revenue pressure.
CounterRevenue has declined 5% year over year and earnings estimates are trending downward; margin compression typically follows revenue decline in consumer healthcare as fixed overhead becomes a larger proportion of a shrinking sales base.
The four consecutive earnings misses averaging negative 7% have already reset expectations significantly lower; the risk of a positive EPS surprise grows as estimates converge toward the true earnings run rate.
→StableEarnings
- Expectation
- Earnings beat consensus by more than 3% in at least 1 of the next 2 quarters, signaling the miss streak is ending.
CounterEstimates trending downward means the market is still adjusting expectations lower; a company that misses by 11.5% and then 11.3% in consecutive quarters may still not have reached bottom estimates.
Despite the confirmed death cross and downtrend, the MACD has improved to a score of 10 — the highest possible reading — suggesting a technical inflection may be forming even as price remains below key moving averages.
→StableMomentum breakdown
- Expectation
- Price crosses above the 200-day moving average within 9 months and sustains above that level for at least 20 consecutive trading days.
CounterMACD improvement in a stock with four consecutive earnings misses and declining revenue is unreliable as a fundamental inflection signal; the price remains near 52-week lows at only 0.4% above the annual trough.
TrendMatrix Research · core thesis
Engine thesis — one sentence
Prestige Consumer Healthcare trades at a forward P/E of 9.3x with analyst upside of 25% and strong operating margins of 17%, but has missed earnings estimates in all 4 of the last 4 quarters with estimates trending downward — making the value case dependent on a fundamental turnaround that has not yet materialized.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
7.1/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 3.4 |
| ROA | 3.7 |
| Gross margin | 7.1 |
| Op margin | 10.0 |
| Net margin | 8.7 |
| Current ratio | 9.4 |
| FCF quality | 7.1 |
| Moat | 5.4 |
| Piotroski F | 8.9 |
- ▸Strong margins: 17%
- ▸No competitive moat
- ▸Strong Piotroski F-Score: 8/9
Growth
2.9/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 1.2 |
| EPS growth | 4.5 |
- ▸Declining revenue: -5%
Momentum
4.2/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.5 |
| MACD | 10.0 |
| OBV | 1.0 |
| MA position | 4.0 |
| Volume | 1.6 |
- ▸Volume distribution (falling OBV)
- ▸Below 200-MA, MA slope -4.6%/30d — confirmed downtrend
Sentiment
5.8/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 8.9 |
| erm sentiment | 3.1 |
- ▸Analyst upside: 35%
Insider
5.0/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.1 |
- ▸Insider selling (low materiality) — $120,444 (0.005% of mkt cap)
Peer rank
3.9/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 6.5 |
| quality rank | 6.9 |
| growth rank | 2.1 |
- ▸Best-in-class margins
Technical
2.0/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 0.8 |
| support resistance | 0.8 |
| 52w position | 1.3 |
| gap | 5.0 |
Risk (lower is worse)
7.1/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 6.3 |
| days to cover | 6.7 |
| volatility | 3.5 |
| put call | 10.0 |
| implied vol | 5.6 |
| beta | 10.0 |
| debt equity | 7.7 |
Catalyst
2.1/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 3.5 |
| earnings history | 0.0 |
| earnings timing | 5.0 |
| surprise avg | 0.0 |
- ▸Earnings concerns: 0B/4M
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (7)
- ASYMMETRY:1.9>=1.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:34d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- MOMENTUM:4.2<4.5
- DEATH_CROSS:HARD_BLOCK
Warning (0)
none
Reward-to-Risk
1.92
Upside
+17.6%
Downside
9.2%
Sizing output
AVOID
SetupRecovery — Death cross but MACD improving, RSI 56
EdgeNo clear edge — No clear edge identified
SuitabilitySpeculative — Drawdown -43% (>40% off 52w high)
Investment implication
The F-path SELL output reflects an overall score of 5.1 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Value at 7.5) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( MOMENTUM:4.2<4.5, DEATH_CROSS:HARD_BLOCK) reinforce the read. Current asymmetry R:R is 1.92 — supplementary context, not the trigger for this path.
The strongest dimensions are Value at 7.5, Quality at 7.1, and Risk (lower is worse) at 7.1; the weakest are Technical at 2.0, Catalyst at 2.1, and Growth at 2.9. The V9 engine flagged 2 failed gates, producing an asymmetric reward-to-risk of 1.92 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Valuation Discount Vs Quality
Trip ifAnalyst consensus price target falls below $45 for 2 consecutive months, eliminating the valuation discount thesis.
- P2Margin Quality Floor Support
Trip ifOperating margin falls below 12% for 2 consecutive quarters, breaking the margin quality floor.
- P3Earnings Miss Streak Resolution
Trip ifEarnings miss consensus by more than 5% for a 5th consecutive quarter, extending the miss streak further.
- P4Macd Recovery Amid Downtrend
Trip ifPrice drops below $40 and holds below that level for more than 10 trading days, invalidating the MACD recovery thesis.