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Latest Ratios: P/E Ratio -41.0x · EV/EBITDA N/A · ROE -9.1%. (2019–2025 historical series)
Price-based multiples — how expensive the stock is relative to earnings, sales, book value, and cash flow
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 |
|---|---|---|---|---|---|---|---|---|
| Market Cap | $632M | $287M | $695M | $312M | $278M | $575M | — | — |
| Enterprise Value | $556M | $211M | $641M | $309M | $306M | $562M | — | — |
| P/E Ratio → | -41.00 | — | — | — | — | — | — | — |
| P/S Ratio | 1.70 | 0.77 | 1.84 | 0.91 | 0.88 | 1.81 | — | — |
| P/B Ratio | 3.76 | 1.69 | 3.99 | 2.53 | 1.90 | 3.21 | — | — |
| P/FCF | 46.42 | 21.08 | 687.14 | 17.82 | — | — | — | — |
| P/OCF | 41.79 | 18.97 | 450.81 | 16.12 | — | — | — | — |
P/E links to full P/E history page with 30-year chart
Enterprise-value multiples — capital-structure-neutral measures of total business value
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 |
|---|---|---|---|---|---|---|---|---|
| EV / Revenue | — | 0.57 | 1.69 | 0.90 | 0.97 | 1.76 | — | — |
| EV / EBITDA | — | — | 216.85 | — | — | — | — | — |
| EV / EBIT | — | — | — | — | — | — | — | — |
| EV / FCF | — | 15.52 | 634.03 | 17.65 | — | — | — | — |
Margins and return-on-capital ratios measuring operating efficiency
Full margin charts and quarterly trend are on the Earnings History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 |
|---|---|---|---|---|---|---|---|---|
| Gross Margin | 33.3% | 33.3% | 38.2% | 29.2% | 29.4% | 34.3% | 35.9% | 32.2% |
| Operating Margin | -5.0% | -5.0% | -1.7% | -11.3% | -15.9% | -11.6% | -4.5% | -13.4% |
| Net Profit Margin | -4.2% | -4.2% | -1.6% | -11.4% | -15.6% | -12.1% | -4.8% | -13.2% |
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 |
|---|---|---|---|---|---|---|---|---|
| ROE | -9.1% | -9.1% | -4.1% | -29.1% | -30.1% | -21.6% | — | — |
| ROA | -6.6% | -6.6% | -2.7% | -17.7% | -19.1% | -15.1% | -6.1% | -13.3% |
| ROIC | -12.9% | -12.9% | -3.9% | -19.8% | -21.9% | -16.7% | — | — |
| ROCE | -10.2% | -10.2% | -3.8% | -24.2% | -24.8% | -17.9% | -7.1% | -16.1% |
Solvency and debt-coverage ratios — lower is generally safer
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 |
|---|---|---|---|---|---|---|---|---|
| Debt / Equity | 0.08 | 0.08 | 0.12 | 0.24 | 0.26 | 0.21 | — | — |
| Debt / EBITDA | — | — | 7.35 | — | — | — | — | — |
| Net Debt / Equity | — | -0.45 | -0.31 | -0.02 | 0.19 | -0.07 | — | — |
| Net Debt / EBITDA | — | — | -18.17 | — | — | — | — | — |
| Debt / FCF | — | -5.56 | -53.11 | -0.17 | — | — | — | — |
| Interest Coverage | -4.20 | -4.20 | — | -144.59 | — | -21.01 | -16.18 | — |
Net cash position: cash ($90M) exceeds total debt ($14M)
Short-term solvency ratios and asset-utilisation metrics
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 |
|---|---|---|---|---|---|---|---|---|
| Current Ratio | 3.98 | 3.98 | 3.57 | 2.78 | 2.97 | 4.41 | 3.21 | 4.34 |
| Quick Ratio | 2.56 | 2.56 | 2.15 | 1.49 | 1.16 | 2.85 | 1.79 | 2.98 |
| Cash Ratio | 1.76 | 1.76 | 1.26 | 0.58 | 0.24 | 1.92 | 1.18 | 2.20 |
| Asset Turnover | — | 1.65 | 1.53 | 1.71 | 1.30 | 1.17 | 1.25 | 1.01 |
| Inventory Turnover | 3.41 | 3.41 | 2.74 | 3.32 | 1.91 | 2.77 | 2.51 | 3.04 |
| Days Sales Outstanding | — | 33.19 | 41.94 | 45.67 | 49.26 | 36.41 | 27.69 | 37.58 |
Earnings, FCF, buyback, and dividend yields — total returns to shareholders
Full dividend history and growth charts are on the Dividend History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 |
|---|---|---|---|---|---|---|---|---|
| Dividend Yield | — | — | — | — | — | 6.1% | — | — |
| Payout Ratio | — | — | — | — | — | — | — | — |
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 |
|---|---|---|---|---|---|---|---|---|
| Earnings Yield | — | — | — | — | — | — | — | — |
| FCF Yield | 2.2% | 4.7% | 0.1% | 5.6% | — | — | — | — |
| Buyback Yield | 0.0% | 0.0% | 0.0% | 0.0% | 0.0% | 0.0% | — | — |
| Total Shareholder Yield | 0.0% | 0.0% | 0.0% | 0.0% | 0.0% | 6.1% | — | — |
| Shares Outstanding | — | $111M | $100M | $95M | $92M | $71M | $90M | $90M |
Includes 30+ ratios · 7 years · Updated daily
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10-year return with dividends reinvested.
Compare growth, multiples, and margins vs sector.
Quick answers to the most common questions about buying HNST stock.
The Honest Company, Inc.'s current P/E ratio is -41.0x. This places it at the 50th percentile of its historical range.
The Honest Company, Inc.'s return on equity (ROE) is -9.1%. The historical average is -18.8%.
Based on historical data, The Honest Company, Inc. is trading at a P/E of -41.0x. This is at the 50th percentile of its historical P/E range. Compare with industry peers and growth rates for a complete picture.
The Honest Company, Inc. has 33.3% gross margin and -5.0% operating margin.
Key Metrics
Top Statement Risk
Profitability on a shrinking revenue base
Metrics are mathematically derived from official filings.
Valuation Premium on a Shrinking Base
The Honest Company trades at a forward P/E of 47.93 and a P/S of 1.68, multiples that appear elevated given the company's ongoing revenue contraction and the recent return to profitability from a deeply unprofitable base.
The forward P/E of 47.93 suggests the market is pricing in a significant earnings recovery, but this multiple is difficult to reconcile with the -19.7% year-over-year revenue decline reported in 2026Q1. The P/S ratio of 1.68 is also high relative to peers like Newell Brands (0.62) and Coty (0.52), indicating the market may be overpaying for a business model that is currently contracting. Investors should monitor whether the recent margin expansion is sustainable or merely a temporary result of aggressive cost-cutting on a smaller revenue base.
Margin Recovery Masked by Revenue Erosion
Gross margin surged to 48.4% in 2026Q2 from a severely depressed 15.7% in 2025Q4, but this recovery appears driven by cost normalization rather than pricing power, as the company's top line continues to contract sharply.
The dramatic swing in gross margin suggests the 2025Q4 figure was likely impacted by non-recurring charges or inventory write-downs, making the 2026Q2 margin of 48.4% a more normalized figure. However, the operating margin of 11.5% in 2026Q2 was achieved through a 54% year-over-year reduction in total operating expenses, indicating the profitability is built on a foundation of severe cost-cutting rather than organic growth. This raises questions about the long-term sustainability of the margin structure if revenue continues to decline.
ROIC Turnaround Driven by Asset Shrinkage
ROIC improved to 8.9% in 2026Q2 from -13.2% in 2025Q4, but this improvement appears to be driven more by a reduction in the invested capital base than by a fundamental improvement in operating efficiency.
The ROIC improvement is notable, but it coincides with a 53% decline in net property, plant, and equipment over ten quarters, suggesting the company is generating returns on a shrinking asset base. The ROE of 6.4% in 2026Q2 is also misleading, as it is built upon a massive accumulated deficit of $490.2M, indicating that recent equity increases are from capital contributions rather than retained earnings. The capital efficiency metrics may be improving, but they are doing so within a business that is contracting.
Working Capital Release Masks Operational Decline
The cash conversion cycle expanded to 122 days in 2026Q2 from 116 days in 2024Q3, primarily due to a significant increase in days inventory outstanding to 117 days, suggesting potential inventory management challenges.
The increase in DIO to 117 days from 112 days over the period, despite a shrinking revenue base, suggests the company may be holding excess inventory or facing slower-moving products. The DSO of 39 days has remained relatively stable, indicating consistent collection practices. However, the DPO of 35 days is lower than the 40 days seen in 2024Q1, suggesting the company may be paying suppliers faster, which could be a result of reduced bargaining power as its scale diminishes.
Deleveraging to Near-Zero Leverage
The debt-to-equity ratio has fallen to a negligible 0.06 in 2026Q2 from 0.22 in 2024Q1, indicating the company has successfully deleveraged and now carries minimal financial risk from debt obligations.
The reduction in total debt from $27.9M to $9.5M over ten quarters has dramatically improved the company's leverage profile, with the D/E ratio now far below the peer average. The interest coverage ratio is not meaningful given the minimal debt load, but the D/EBITDA of 0.70 in 2026Q2 confirms the comfortable leverage position. This deleveraging provides financial flexibility, but it also reflects a strategic decision to prioritize balance sheet strength over growth investments during a period of revenue contraction.
The Misleading Power of Current Ratio
The current ratio of 3.94 in 2026Q2 appears exceptionally strong, but it is inflated by a cash surge that may not be sustainable, as it was driven by working capital releases and minimal capital expenditures during a period of severe revenue contraction.
The current ratio is the most commonly misapplied metric to this business model because it suggests a fortress-like liquidity position that may not reflect the underlying operational reality. The ratio is high primarily because cash reserves tripled to $105.9M while current liabilities fell, but this cash accumulation was aided by a $14.7M positive working capital change in 2026Q2 and minimal CapEx. A more appropriate metric would be the quick ratio, which at 2.97 still indicates strong liquidity but provides a more conservative view by excluding inventory. Investors should focus on the sustainability of cash generation rather than the static liquidity ratio, especially given the ongoing revenue decline.