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LOS ANGELES—Vernon Carla, Chief Executive Officer of Honest Company , Inc. (NASDAQ:HNST), recently sold a significant portion of the company’s common stock. According to a filing with the Securities and Exchange Commission, Carla disposed of 193,078 shares on March 7 at a price of $4.91 per share, amounting to a total transaction value of approximately $948,012. The transaction comes as the company, currently valued at $512 million, trades near its InvestingPro Fair Value despite showing 9.87% revenue growth over the last twelve months.
The shares were sold as part of a pre-approved sell-to-cover plan aimed at covering tax liabilities associated with the vesting of previously granted Restricted Stock Units (RSUs). Following this transaction, Carla retains direct ownership of 3,197,271 shares, which includes 2,441,056 RSUs that are convertible into an equivalent number of common shares.
This transaction is part of a broader strategy approved by the company’s Compensation Committee, underscoring the routine nature of such sales for executives managing tax obligations.
In other recent news, The Honest Company reported its fourth-quarter and full-year 2024 earnings, revealing a notable increase in revenue and profitability. The company exceeded earnings expectations with an earnings per share (EPS) of -$0.01, surpassing the forecast of -$0.02. Revenue for the quarter reached $99.84 million, beating the anticipated $96.34 million. For the entire year, revenue rose by 10% year-over-year, totaling $378 million. Despite these positive results, the company’s stock experienced a decline in aftermarket trading.
The Honest Company also achieved its first full year of positive Adjusted EBITDA, amounting to $26 million, with a margin of 6.8%. Looking ahead to 2025, the company projects revenue growth between 4-6% and expects Adjusted EBITDA to be in the range of $27-30 million. The company anticipates that the first quarter of 2025 will see growth outpacing the full-year guidance. Additionally, the company introduced new products and made improvements in supply chain efficiencies, which contributed to a gross margin expansion of 900 basis points to 38%.
In terms of analyst activity, there was no mention of any upgrades or downgrades from firms such as AGP, JPMorgan, or B. Riley Securities. However, the analysts did inquire about distribution opportunities and margin expansion strategies during the earnings call. The Honest Company continues to focus on expanding its distribution and product offerings, aiming to drive growth in the coming year.
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