Honest (NASDAQ:HNST) Announces Quarterly Earnings Results

Honest (NASDAQ:HNST) released its quarterly earnings data on Wednesday. The company reported ($0.21) earnings per share for the quarter, missing analysts’ consensus estimates of $0.02 by ($0.23), FiscalAI reports. Honest had a return on equity of 3.86% and a net margin of 1.85%.The business had revenue of $88.04 million during the quarter, compared to analyst estimates of $88.57 million.

Here are the key takeaways from Honest’s conference call:

• The company has materially narrowed its portfolio by exiting apparel, Canada, and Honest.com fulfillment, right-sized SG&A, and is consolidating warehouses to focus on wipes, personal care, and diapers.
• Honest reported strong underlying demand with organic revenue of $294M (+5.3%) and consumption growth of 5% in 2025—driven by wipes (+30%) and personal care (+12%)—and guides to 4%–6% organic growth in 2026.
• Profitability is improving—adjusted gross margin 38.7% in 2025 (up 50 bps) and management expects adjusted gross margins in the low-40s in 2026, supported by the Powering Honest Growth program targeting $10M–$15M of annual savings and H2 warehouse benefits.
• The balance sheet is strong with ~$90M cash, no debt, and an inaugural $25M share repurchase authorization, giving the company flexibility to return capital while funding growth.
• Diapers—still ~30% of sales—saw double-digit consumption declines due to retailer assortment shifts, lapped promotions, and consumers trading down; management says diapers will remain a headwind in 2026 and faces a ~20%–30% price premium challenge.

Honest Stock Performance

Honest stock traded up $0.05 during trading on Wednesday, reaching $2.31. The company had a trading volume of 1,539,671 shares, compared to its average volume of 1,800,285. The firm has a market capitalization of $258.24 million, a PE ratio of 38.50 and a beta of 2.30. The firm’s 50-day simple moving average is $2.48 and its 200 day simple moving average is $3.10. Honest has a 1-year low of $2.07 and a 1-year high of $5.87.

Analyst Upgrades and Downgrades

Several brokerages have weighed in on HNST. B. Riley Financial reaffirmed a “buy” rating on shares of Honest in a research report on Thursday, November 6th. Lake Street Capital lowered Honest from a “buy” rating to a “hold” rating and set a $3.00 target price on the stock. in a report on Thursday, November 6th. JPMorgan Chase & Co. reissued an “underweight” rating on shares of Honest in a report on Friday, January 16th. Zacks Research lowered Honest from a “strong-buy” rating to a “hold” rating in a research report on Thursday, November 6th. Finally, Telsey Advisory Group reaffirmed a “market perform” rating and set a $3.00 target price on shares of Honest in a report on Thursday, February 19th. One equities research analyst has rated the stock with a Buy rating, four have assigned a Hold rating and two have assigned a Sell rating to the company. Based on data from MarketBeat, the company has a consensus rating of “Reduce” and an average price target of $3.00.

Institutional Trading of Honest

Several institutional investors have recently modified their holdings of HNST. Caitong International Asset Management Co. Ltd raised its position in shares of Honest by 1,392.2% during the 3rd quarter. Caitong International Asset Management Co. Ltd now owns 7,073 shares of the company’s stock worth $26,000 after purchasing an additional 6,599 shares during the last quarter. Equity Wealth Partners LLC purchased a new stake in Honest during the 3rd quarter worth approximately $37,000. CIBC Bancorp USA Inc. acquired a new position in shares of Honest during the third quarter valued at approximately $39,000. Northwestern Mutual Wealth Management Co. lifted its position in shares of Honest by 85,544.4% in the third quarter. Northwestern Mutual Wealth Management Co. now owns 15,416 shares of the company’s stock valued at $57,000 after acquiring an additional 15,398 shares in the last quarter. Finally, Abel Hall LLC acquired a new stake in shares of Honest in the fourth quarter worth approximately $60,000. Institutional investors and hedge funds own 45.54% of the company’s stock.

Honest Company Profile

The Honest Company, Inc (NASDAQ: HNST) is an American consumer goods firm specializing in eco-friendly and responsibly formulated products for babies, personal care, beauty and home cleaning. The company emphasizes transparency in ingredient sourcing and product safety, positioning itself in the premium segment of mass-market retail and direct-to-consumer channels.

Honest was founded in 2011 by actress Jessica Alba and environmental health advocate Christopher Gavigan with a mission to offer parents household and baby care items free from harsh chemicals and synthetic fragrances.