Edgewell Personal Care (EPC) is positioned for a meaningful fiscal H2 improvement as distribution gains, innovation launches, and a more focused portfolio begin to take hold, RBC Capital Markets said Tuesday in a report.

Management has pointed to "material increases" in distribution gains, with updated shelf layouts expected to be largely completed over the next several weeks, the report said. Combined with a robust innovation pipeline across Japan, Europe, and the U.S., the changes position Edgewell for a stronger H2 acceleration, driven more by market-share gains than by category growth, RBC said.

With the divestiture of the feminine-care business now closed, the remaining company is "better positioned to go on the offensive and drive a return to sustainable top-line growth," the report said. The sale also improves gross-margin mix and frees up capital for deleveraging, RBC said.

Still, fiscal Q2 is slated to be the weakest quarter with a 3% organic sales decline tied partly to timing shifts in Sun Care orders, the report said.

RBC maintained its outperform rating on Edgewell stock with a $23 price target.

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