Olaplex Holdings Forecasts ‘Reset’ Year Ahead, Stock Slips Sharply Following Mixed Q4 Report.
March 1, 2023
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Olaplex Holdings ($NASDAQ:OLPX) was met with a setback on Tuesday, as its share prices plummeted following the release of a mixed Q4 report. Despite exceeding expectations on the bottom line, the company missed estimates on the top line, forcing analysts to adjust their outlook for the coming year. According to the report, net sales dropped by 28% in the United States and 13% globally. This caused a reset for the company, as it now must reassess the strategies it had put in place for the year ahead. On the one hand, Olaplex Holdings did manage to beat analyst expectations on the bottom line, but investors were less than optimistic about their future.
The next few quarters will be crucial not only for Olaplex, but for all companies in the hair care industry. With net sales continuing to decline and expectations resetting, companies must find new ways to grow and generate revenue. Olaplex remains confident, however, that its products and innovation strategy will remain successful in the long term.
Market Price
At time of writing, news sentiment surrounding Olaplex Holdings is mostly negative. On Tuesday, the company’s stock opened at $4.4 and closed at $4.9, a drop of 9.1% from the prior closing price of $5.4. This followed a mixed fourth quarter report released by the company, leading many analysts to reset their forecasts for the year ahead. In response to the report, Olaplex Holdings has seen its stock price slip sharply. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Olaplex Holdings. More…
| Total Revenues | Net Income | Net Margin |
| 740.05 | 279.75 | 39.8% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Olaplex Holdings. More…
| Operations | Investing | Financing |
| 251.51 | -2.62 | -120.97 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Olaplex Holdings. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 1.7k | 952.8 | 1.15 |
Key Ratios Snapshot
Some of the financial key ratios for Olaplex Holdings are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| – | – | 53.5% |
| FCF Margin | ROE | ROA |
| 33.6% | 34.8% | 14.6% |
Analysis
At GoodWhale, we’ve conducted a thorough analysis of OLAPLEX HOLDINGS‘s financials. Based on our Risk Rating algorithm, we determined that OLAPLEX HOLDINGS is a medium risk investment. We advise investors to be aware of potential risks associated with the company and its investments. We found one risk warning in the company’s balance sheet. To know more about the potential risks of investing in OLAPLEX HOLDINGS, we invite you to register with us to gain access to our detailed report. We have carefully considered all the risks and provided our insights on what to expect from such an investment. More…
Peers
The market for hair care products has seen intense competition in recent years, with Olaplex Holdings Inc emerging as a major player. The company has been pitted against some of the biggest names in the industry, including FSN E-Commerce Ventures Ltd, Matas A/S, and Petco Health and Wellness Co Inc. While all of these companies offer similar products and services, Olaplex has differentiated itself with its unique approach to hair care.
– FSN E-Commerce Ventures Ltd ($BSE:543384)
FSN E-Commerce Ventures Ltd. is an online retailer that operates in the e-commerce industry. The company was founded in 2004 and is headquartered in Shenzhen, China. FSN E-Commerce Ventures Ltd. operates in three segments: Retail, Marketplace, and Advertising. The Retail segment offers products and services through its online retail platform. The Marketplace segment provides an online marketplace for third-party sellers to sell their products and services. The Advertising segment offers online advertising services. FSN E-Commerce Ventures Ltd. has a market cap of 542.98B as of 2022 and a Return on Equity of 4.81%.
– Matas A/S ($LTS:0QFA)
Matas A/S is a Danish retailer of health and beauty products with a market cap of 2.87B as of 2022. The company has a Return on Equity of 8.02%. Matas A/S is a leading retailer of health and beauty products in Denmark with over 1,200 stores. The company offers a wide range of products including skin care, hair care, cosmetics, wellness, and fragrance. Matas A/S is a publicly traded company listed on the Copenhagen Stock Exchange.
– Petco Health and Wellness Co Inc ($NASDAQ:WOOF)
Petco Health and Wellness Co Inc is a leading pet retailer with a market cap of 2.83B as of 2022 and a Return on Equity of 6.12%. The company offers a wide range of products and services for pets, including food, toys, and health and wellness products. Petco also offers a variety of services, such as grooming, boarding, and training.
Summary
Olaplex Holdings had a mixed Q4 report, which has caused their stock price to dip sharply. At the time of writing, market sentiment appears to be largely negative. Nevertheless, the company’s expectations for the coming year are more optimistic, forecasting a “reset” year ahead. With technology advancing and the digital revolution driving more investments in the sector, Olaplex could potentially be an interesting opportunity in the near future.
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