2024-03-18 17:06:25 ET
Summary
- The Beauty Health has fallen by 70% over the last 1 year and is currently trading for 1.13x trailing 12-month sales.
- Sales and GAAP gross margins dipped during its fiscal 2023 fourth quarter as the company chases cost savings.
- A focus on debt reduction versus share buybacks would be prudent with the company purchasing $57.6 million of its debt in January.
The Beauty Health Company ( SKIN ) was one of my pandemic-era plays with 3x returns post de-SPACing. SKIN was operating within a zeitgeist then characterized by rabid investor enthusiasm around growth tickers and the company's unique land and expand business model of its proprietary HydraFacial skin care treatment and subsequent consumables. It's a three-part routine of cleansing, exfoliating, and then infusion of the skin with several serums which form the recurring consumables part of the business. The HydraFacial system is sold to professionals, mainly medical spas and clinics, retailing with treatments costing upwards of $350 per session. The company has pulled back 70% over the last year, currently trading for a roughly $450 million market cap against cash and equivalents of $523 million on its balance sheet and total debt of roughly $752 million ....
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For further details see:
The Beauty Health Company: Is This Collapsed Growth Story Now A Buy?