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Investing.com - Canaccord Genuity lowered its price target on Edgewell Personal Care (NYSE:EPC) to $32.00 from $35.00 while maintaining a Buy rating following the company’s third-quarter earnings report. The stock, currently trading at $20.29, appears undervalued according to InvestingPro analysis, with multiple indicators suggesting potential upside.
The personal care products company reported a 3.2% sales decline for the quarter ended June, missing analyst expectations of approximately 0.9% growth. Organic sales fell 4.2% overall, with North American sales dropping 8.0% while international sales grew 2.2%. Technical indicators from InvestingPro show the stock is currently in oversold territory, trading near its 52-week low of $19.13.
North American performance was broadly pressured across all segments, while international markets benefited from price gains primarily in the Wet Shave and Sun & Skin segments. Management cited retailer inventory tightening, feminine care portfolio consolidation, a weak sun season, and macroeconomic pressures on consumer sentiment as factors behind the disappointing results.
Edgewell expects organic sales to return to growth in the fourth quarter, driven by strength in their "Right to Win" portfolio and continued international growth. The company’s stock is currently trading at approximately 7.3 times Canaccord’s fiscal year 2026 earnings estimate.
Canaccord believes Edgewell’s stock has oversold compared to its five-year average price-to-earnings ratio of approximately 12x, supporting their maintained Buy rating despite the reduced price target resulting from lower fiscal year 2026 earnings estimates. InvestingPro subscribers can access 12 additional exclusive tips and comprehensive financial metrics to better evaluate this investment opportunity.
In other recent news, Edgewell Personal Care reported its third-quarter earnings, which fell short of analysts’ expectations. The company posted an earnings per share (EPS) of $0.92, missing the forecasted $1.00, and generated revenue of $627.2 million, below the anticipated $655.17 million. Following these results, Edgewell Personal Care adjusted its full-year guidance downward. In response to the earnings miss and subsequent stock decline, Morgan Stanley (NYSE:MS) upgraded Edgewell Personal Care’s stock rating from Underweight to Equalweight. However, the firm also lowered its price target from $26.00 to $23.00. These developments reflect the company’s recent challenges in achieving expected organic sales growth and maintaining gross margins.
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