Baird analyst Mark Altschwager noted Sally Beauty reported above consensus earnings with improved gross margins and lower SG&A. He said there was a comp shortfall at both the retail and professional divisions as a weak spending environment drove the downside. He believes, however, that pricing and sourcing initiatives are bearing fruit and the company is realizing its cost savings goals, leading him to increase his estimates. Altschwager likes the risk/reward at current levels and reiterated his Outperform rating and $26 price target on Sally Beauty shares.