What Happened?
Shares of hair care company Olaplex (NASDAQ: OLPX) jumped 8.3% in the afternoon session after the company announced strategic additions to its Board of Directors, signaling a renewed focus on growth and innovation.
The haircare company appointed two seasoned retail and consumer brand veterans, Jerome Griffith and Pamela Edwards, to its board. Griffith formerly served as the CEO of Lands' End and Tumi, while Edwards was the CFO for Citi Trends and Victoria's Secret. Olaplex's CEO, Amanda Baldwin, stated that the appointments were a top priority in building a best-in-class team to execute the company's new chapter grounded in health and beauty innovation. The stock also appeared to benefit from a broader rally in the consumer staples sector. Investors seemed to flock to defensive industries on signs that shoppers continued to spend on essential goods, including personal care, despite economic uncertainties.
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What Is The Market Telling Us
Olaplex’s shares are extremely volatile and have had 54 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 5 months ago when the stock gained 22.5% on the news that the company reported fourth-quarter results that significantly exceeded analysts' sales and EPS expectations. Olaplex's operating profit also outperformed Wall Street estimates by a wide margin, and its full-year revenue guidance came in ahead of expectations. On the other hand, sales dropped 9.8%. The sales decline weighed on profitability, with gross profit down 13% and adjusted EBITDA shrinking by more than half. Overall, this was a mixed yet decent quarter.
Olaplex is down 1.5% since the beginning of the year, and at $1.67 per share, it is trading 36.5% below its 52-week high of $2.62 from September 2024. Investors who bought $1,000 worth of Olaplex’s shares at the IPO in September 2021 would now be looking at an investment worth $67.96.
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