Olaplex Holdings Upgraded to Buy: Strong Brand Revival and Attractive Valuation

Olaplex Holdings has been upgraded to a Buy rating by Susan Anderson from Canaccord Genuity, citing a revitalized brand, stabilization in sales and margins, strategic investments in marketing and innovation, and an attractive valuation compared to peers. The company operates in the prestige hair category, which is experiencing robust growth. Anderson's rating is supported by the management's efforts in brand refresh and inventory management. However, corporate insider sentiment is negative due to an increase in insider selling.

Title: Olaplex Holdings Upgraded to Buy by Canaccord Genuity

Olaplex Holdings has been upgraded to a Buy rating by Susan Anderson from Canaccord Genuity, with a price target of $2.00 [1]. The upgrade is based on several key factors that highlight the company's potential for growth and market positioning. Olaplex has experienced a revitalization of its brand, which is now poised to leverage its prestige status in the beauty industry for renewed growth [1]. The company has seen stabilization in both sales and margins, with recent quarters showing positive growth for the first time in several quarters [1]. This stability is supported by strategic investments in marketing, merchandising, and innovation, which are beginning to yield results [1].

Olaplex is trading at a valuation that is attractive compared to its peers, with a lower EBITDA multiple despite having normalized its margins to industry standards [1]. The prestige hair category, in which Olaplex operates, continues to show robust growth, providing a solid foundation for the company’s future expansion [1]. The management’s efforts in brand refresh and inventory management have also been positively received, indicating strong execution capabilities [1].

However, corporate insider sentiment is negative due to an increase in insider selling. Over the past quarter, there has been an increase of insiders selling their shares of OLPX in relation to earlier this year [1].

Olaplex Holdings operates in the prestige hair category, which is experiencing robust growth. The company offers science-backed solutions that improve hair health and addresses consumers' relevant haircare concerns through its proprietary technology and innovation capabilities [2]. The company generates the majority of its revenue from Professional sales channels followed by Specialty Retail and then DTC, with the International market accounting for the majority of its revenue [2].

Analysts have provided various insights into Olaplex Holdings. In the last quarter, 6 analysts analyzed the company, revealing a spectrum of viewpoints from bullish to bearish. The analysts' recent ratings show a mix of bullish and somewhat bullish sentiments, with an average price target of $1.83, a high estimate of $2.00, and a low estimate of $1.50 [2]. Susan Anderson from Canaccord Genuity raised the rating to Buy from Hold, with a price target of $2.00 [2]. This upgrade is in line with the company's recent performance and market positioning.

Olaplex Holdings' financial performance is notable. The company achieved a revenue growth rate of 2.25% in the 3M period ending June 30, 2025, surpassing industry averages [2]. The company's net margin of -7.28% is a standout performer, exceeding industry averages. However, the company's ROE and ROA are below industry benchmarks, signaling potential challenges in efficiently using equity and assets [2].

In conclusion, Olaplex Holdings' upgrade to a Buy rating by Canaccord Genuity is supported by a revitalized brand, stabilization in sales and margins, strategic investments in marketing and innovation, and an attractive valuation compared to peers. However, the negative corporate insider sentiment and challenges in efficiently using equity and assets should be considered by investors.

References
[1] https://www.tipranks.com/news/ratings/olaplex-holdings-strong-buy-rating-backed-by-brand-revitalization-and-attractive-valuation-ratings?mod=mw_quote_news
[2] https://www.benzinga.com/insights/analyst-ratings/25/08/47305269/where-olaplex-hldgs-stands-with-analysts