Sally Beauty (SBH) Shares Soar 3.87% to 2025 High on Analyst Upgrades, Cost-Cutting Optimism

Sally Beauty (SBH) shares surged to a 2025 high of $15.93 intraday on September 20, marking a 3.87% gain and a 3.03% rise over two days. The stock’s recent momentum reflects renewed investor confidence amid strategic shifts and operational improvements, positioning the company for a potential turnaround.

Analyst activity has been a key catalyst, with upgrades from Canaccord Genuity and TD Cowen in late August and September 2025. Canaccord raised its price target to $19.00 from $15.00, while TD Cowen adjusted its target to $16.00 from $13.00, both citing optimism about Sally Beauty’s cost-cutting initiatives and profitability. Despite a “Hold” downgrade from Wall Street Zen on September 21, the average analyst rating remains a “Moderate Buy” with a $13.88 target, indicating a consensus for cautious optimism.

Operational performance has also bolstered sentiment. The company reported Q2 2025 earnings of $0.51 per share, surpassing estimates, alongside a 5.26% net margin. Its “Fuel for Growth” cost-saving program, expected to yield $120 million in savings, is central to restoring profitability. These efforts align with broader strategic moves, such as a partnership with DoorDash for a pop-up event, which underscores Sally Beauty’s pivot to digital innovation and e-commerce. The collaboration aims to expand product accessibility and attract new customer segments.

Institutional and insider buying further signal confidence. Directors Max Rangel and Diana Ferguson increased holdings in August and September, while institutional investors like Osaic Holdings and Golden State Wealth Management significantly expanded their stakes. This inflow highlights growing recognition of the company’s undervaluation and long-term potential amid a high-debt environment.

Despite recent gains, challenges remain, including a 1.0% year-over-year revenue decline in Q2 and a debt-to-equity ratio of 1.16. However, the stock’s volatility—marked by 22 price moves exceeding 5% in the past year—reflects shifting investor perceptions. With FY 2025 guidance projecting $1.81 EPS and a focus on digital transformation, Sally Beauty’s trajectory suggests a balance between near-term risks and long-term growth opportunities.