Olaplex Holdings (NASDAQ: OLPX) shares plunged 7.59% on mixed analyst outlooks and shifting institutional positioning.

Olaplex Holdings (NASDAQ: OLPX) shares plunged 7.5862% in pre-market trading on January 2, 2026, signaling renewed investor caution amid mixed analyst outlooks and evolving institutional positioning. The decline follows a volatile trading pattern earlier in the week, with the stock hitting intraday lows below $1.36, reflecting broader market skepticism despite the company’s recent earnings report showing breakeven performance.

Analyst sentiment remains fragmented, with Northland Capital upgrading to “strong-buy” in late November and Barclays cutting its price target to $1.25, while Zacks Research revised its rating from “strong sell” to “hold.” Institutional investors have shown divergent strategies, with Portolan Capital Management and UBS Group significantly increasing stakes in Q3 2024, though hedge fund ownership remains concentrated at 87.37% of the float. The stock’s 50-day moving average of $1.18 and 200-day average of $1.33 highlight its prolonged underperformance relative to broader market benchmarks.

Olaplex’s core business faces ongoing challenges, including a 3.8% year-over-year revenue decline in Q4 2024 to $114.58 million and a negative net margin of 1.18%. While the company’s bond-building technology maintains a strong professional salon presence, institutional investors appear to be recalibrating their exposure ahead of the fiscal 2025 earnings outlook of $0.10 per share. Market participants will likely monitor upcoming analyst revisions and institutional flow for directional clues as the stock trades near multi-month lows.

Institutional investors have been adjusting their stakes in response to both the evolving market sentiment and the firm's fundamental performance. The recent 7.5862% pre-market drop, while steep, has occurred amid a broader narrative of mixed signals from analysts and shifting institutional strategies. The Q3 2024 buying spree by Portolan Capital and UBS contrasts with the still-dominant hedge fund position of 87.37%, suggesting ongoing debate over the stock’s long-term prospects.

Olaplex’s recent earnings report showed the company narrowly avoiding a loss, achieving breakeven performance in the most recent quarter. Despite this, the stock’s year-to-date performance has been lackluster, with Q4 2024 revenue falling to $114.58 million, down from prior-year levels. The negative net margin of 1.18% underscores the company’s struggle to turn a profit in an increasingly competitive salon product landscape. Investors remain skeptical, with many waiting for a clearer earnings path before committing to a long-term position.

The recent earnings report, while narrowly positive, did little to reverse the stock’s downward trajectory. Institutional investors are likely using the current price correction as an opportunity to reassess their positions, while hedge funds continue to maintain a dominant hold on the float. With the stock trading near multi-month lows, the next earnings report and potential analyst revisions could serve as key catalysts for a broader reevaluation of Olaplex’s value proposition in the beauty care sector.