Olaplex Holdings Inc. (NASDAQ:OLPX) shares plunged 7.59% as mixed institutional activity and earnings performance weigh on confidence

Olaplex Holdings Inc. (NASDAQ:OLPX) shares plunged 7.5862% in pre-market trading on January 2, 2026, marking a sharp reversal from recent analyst-driven optimism. The selloff followed mixed institutional activity and earnings performance that failed to sustain investor confidence.

Analyst ratings remained polarized, with Northland Capital upgrading to "strong buy" in November while Wall Street Zen downgraded to "sell." Institutional investors showed divergent strategies, with Portolan Capital and UBS Group boosting stakes by over 130% and 45% respectively in Q3 2025, yet the stock’s 52-week low of $1.18 and 3.8% year-over-year revenue decline highlighted underlying fragility.

Despite a $0.02 EPS beat in Q4 2025, the company’s negative net margin of 1.18% and elevated debt-to-equity ratio of 0.40 signaled operational challenges. The recent 7.6% drop suggests investors are pricing in execution risks for a brand heavily reliant on salon partnerships and premium positioning in a competitive haircare market.

Olaplex’s financial struggles are compounded by its narrow profit margins and reliance on a specific distribution model. While the brand maintains a premium image and brand loyalty among salon professionals, these strengths appear increasingly offset by macroeconomic pressures and a saturated beauty market. The stock’s volatility is likely to persist until clearer earnings momentum or strategic pivots emerge.