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On Tuesday, Stifel analysts revised their outlook on Hain Celestial (NASDAQ:HAIN) shares, reducing the price target from $7.00 to $6.00, while maintaining a Hold rating on the stock. Currently trading at $4.19, InvestingPro analysis suggests the stock is undervalued, with additional indicators pointing to oversold conditions. The adjustment follows Hain Celestial’s announcement of a weaker-than-expected performance for its second quarter. The natural and organic products company reported a significant decline in total organic sales and earnings before interest, taxes, depreciation, and amortization (EBITDA).
The company’s total organic sales fell by 7% in the second quarter, and its EBITDA dropped 20% compared to the previous year, coming in at $37.9 million. This figure also fell short of Stifel’s estimate by $5.4 million. While concerning, InvestingPro data shows the company maintains a healthy current ratio of 2.01, with liquid assets exceeding short-term obligations. The disappointing results have led to a revision of Hain Celestial’s full-year 2025 (FY25) revenue and EBITDA outlook.
Initially, the company had expected organic sales to remain flat or improve, but the revised forecast now anticipates a decline of 4% to 2%. This suggests an expectation of a -2% to +2% performance in the latter half of the year. Additionally, EBITDA projections have been adjusted from an anticipated mid-single digit growth to now being expected to remain flat for the year.
The downgraded financial outlook reflects not only the company’s underperformance in the second quarter but also the challenging macroeconomic environment that Hain Celestial and other companies are currently navigating. The updated figures and forecasts provide investors with a clearer picture of the company’s financial health and future expectations.
In other recent news, Hain Celestial has been the subject of revised outlooks from Bernstein SocGen Group and Jefferies. Bernstein has reduced its price target for Hain Celestial from $12.00 to $8.00, maintaining an Outperform rating, following the company’s recent quarterly financial results, which fell short of market expectations. Meanwhile, Jefferies has cut its price target for Hain Celestial from $7.55 to $4.50, maintaining a Hold rating. Both adjustments come in the wake of Hain Celestial’s disappointing Q2 results, including a 6% decline in organic sales growth and a downward revision of its full-year guidance.
Hain Celestial has also announced the opening of a new distribution center in Savannah, Georgia, marking the completion of a multi-year expansion project. The new center is expected to enhance the company’s supply chain and customer service by reducing the distance for product deliveries by about 66% annually. This change could result in multimillion-dollar savings through reduced fuel and maintenance costs.
These recent developments suggest a challenging landscape for Hain Celestial, with analysts from Bernstein and Jefferies expressing cautious optimism for the company’s long-term growth potential despite the recent underperformance. The company’s management remains confident, expecting positive organic sales growth by the end of the current quarter and a continued focus on operational efficiencies and supply chain enhancements.
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