The end of the earnings season is always a good time to take a step back and see who shined (and who not so much). Let’s take a look at how specialized consumer services stocks fared in Q1, starting with Matthews (NASDAQ: MATW).
Some consumer discretionary companies don’t fall neatly into a category because their products or services are unique. Although their offerings may be niche, these companies have often found more efficient or technology-enabled ways of doing or selling something that has existed for a while. Technology can be a double-edged sword, though, as it may lower the barriers to entry for new competitors and allow them to do serve customers better.
The 10 specialized consumer services stocks we track reported a slower Q1. As a group, revenues missed analysts’ consensus estimates by 0.6% while next quarter’s revenue guidance was in line.
In light of this news, share prices of the companies have held steady as they are up 4.7% on average since the latest earnings results.
Matthews (NASDAQ: MATW)
Originally a death care company, Matthews International (NASDAQ: MATW) is a diversified company offering ceremonial services, brand solutions and industrial technologies.
Matthews reported revenues of $427.6 million, down 9.3% year on year. This print fell short of analysts’ expectations by 1.8%. Overall, it was a softer quarter for the company with a significant miss of analysts’ EPS estimates and full-year EBITDA guidance missing analysts’ expectations.
Interestingly, the stock is up 3.7% since reporting and currently trades at $21.22.
Read our full report on Matthews here, it’s free.
Best Q1: Frontdoor (NASDAQ: FTDR)
Established in 2018 as a spin-off from ServiceMaster Global Holdings, Frontdoor (NASDAQ: FTDR) is a provider of home warranty and service plans.
Frontdoor reported revenues of $426 million, up 12.7% year on year, outperforming analysts’ expectations by 2.1%. The business had a very strong quarter with EBITDA guidance for next quarter exceeding analysts’ expectations and an impressive beat of analysts’ EPS estimates.
Frontdoor achieved the fastest revenue growth and highest full-year guidance raise among its peers. The market seems happy with the results as the stock is up 32.1% since reporting. It currently trades at $54.27.
Is now the time to buy Frontdoor? Access our full analysis of the earnings results here, it’s free.
Weakest Q1: 1-800-FLOWERS (NASDAQ: FLWS)
Founded in 1976, 1-800-FLOWERS (NASDAQ: FLWS) is an online retailer of flowers, gifts, and gourmet foods, serving customers globally.
1-800-FLOWERS reported revenues of $331.5 million, down 12.6% year on year, falling short of analysts’ expectations by 9%. It was a disappointing quarter as it posted a significant miss of analysts’ EBITDA and EPS estimates.
1-800-FLOWERS delivered the weakest performance against analyst estimates and slowest revenue growth in the group. As expected, the stock is down 6.2% since the results and currently trades at $5.44.
Read our full analysis of 1-800-FLOWERS’s results here.
Pool (NASDAQ: POOL)
Founded in 1993 and headquartered in Louisiana, Pool (NASDAQ: POOL) is one of the largest wholesale distributors of swimming pool supplies, equipment, and related leisure products.
Pool reported revenues of $1.07 billion, down 4.4% year on year. This result came in 2.5% below analysts' expectations. It was a slower quarter as it also recorded a miss of analysts’ organic revenue and EPS estimates.
The stock is up 1.8% since reporting and currently trades at $314.99.
Read our full, actionable report on Pool here, it’s free.
ADT (NYSE: ADT)
Founded in 1874 and headquartered in Boca Raton, Florida, ADT (NYSE: ADT) is a provider of security, automation, and smart home solutions, offering comprehensive services for home and business protection.
ADT reported revenues of $1.27 billion, up 6.5% year on year. This print topped analysts’ expectations by 2%. Taking a step back, it was a satisfactory quarter as it also logged an impressive beat of analysts’ EPS estimates but a miss of analysts’ customers estimates.
The stock is up 7.5% since reporting and currently trades at $8.51.
Read our full, actionable report on ADT here, it’s free.
Market Update
In response to the Fed’s rate hikes in 2022 and 2023, inflation has been gradually trending down from its post-pandemic peak, trending closer to the Fed’s 2% target. Despite higher borrowing costs, the economy has avoided flashing recessionary signals. This is the much-desired soft landing that many investors hoped for. The recent rate cuts (0.5% in September and 0.25% in November 2024) have bolstered the stock market, making 2024 a strong year for equities. Donald Trump’s presidential win in November sparked additional market gains, sending indices to record highs in the days following his victory. However, debates continue over possible tariffs and corporate tax adjustments, raising questions about economic stability in 2025.
Want to invest in winners with rock-solid fundamentals? Check out our Strong Momentum Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
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