Olaplex Holdings (OLPX) AI Stock Analysis

• Market Cap: $1.09B
• Dividend Yield: N/A
• Average Volume (3M): 1.95M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.27
• Revenue Growth: -3.47%
• EPS Growth: -111.68%
• Country: US
• Employees: 231
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Specialty Retail
• EPS (TTM): 0.03
• Shares Outstanding: 667,511,900
• 10 Day Avg. Volume: 3,354,798
• 30 Day Avg. Volume: 1,953,932
• PEG Ratio: -0.85
• Price to Book (P/B): 1.31
• Price to Sales (P/S): 2.71
• P/FCF Ratio: 8.07
• Enterprise Value/Market Cap: 0.86
• Enterprise Value/Revenue: 2.24
• Enterprise Value/Gross Profit: 3.38
• Enterprise Value/Ebitda: 10.22
• 1Y Price Target: $1.91
• Price Target Upside: 15.76% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 8
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 57 Neutral
• Price Target: $1.50 ▼(-9.09% Downside)

The score is held back primarily by the sharp profitability reset and slightly negative net income despite continued positive (but weakening) free cash flow. Technicals are supportive with the stock trading above major moving averages and positive MACD, while valuation remains unattractive due to a negative P/E. Earnings call commentary was constructive on product innovation and maintained guidance, but ongoing sales declines and channel weakness temper the outlook.

Positive Factors

Acquisition driving science-led innovation

Acquiring Purvala adds a science-driven R&D asset that can create proprietary, bio-inspired formulations. This materially strengthens Olaplex’s long-term product pipeline and differentiation, supporting sustainable premiumization, repeat purchases and higher margins over multiple years.

Very high gross margins

Sustained gross margins near 70% provide a durable profitability buffer, allowing the company to absorb higher marketing or R&D spend while protecting unit economics. This structural margin strength supports reinvestment in brand and product development over the medium term.

Positive free cash flow and lower leverage

Positive FCF alongside declining debt enhances financial flexibility, enabling continued investment in innovation, marketing, or opportunistic M&A without over-reliance on external financing. Improved leverage (debt-to-equity falling) reduces solvency risk and supports strategic optionality.

Negative Factors

Profitability compression

A sharp drop in operating profitability and a return to net loss signal weakened earnings power. If higher operating costs or weaker sales persist, ROE and internal funding capacity will be impaired, limiting long-term growth investments and reducing resilience to demand shocks.

Declining sales and channel weakness

Structural declines in key channels, notably specialty retail, and overall sales shrinkage versus a faster-growing prestige haircare market suggest deteriorating distribution and consumer traction. Persistent channel losses would pressure long-term top-line growth and market share recovery.

Concentrated ownership and takeover dynamics

Very high ownership concentration and an external takeover bid create governance and strategic uncertainty for minority stakeholders. Concentrated control can limit public-market liquidity and dictate strategic outcomes, potentially shortening the company’s independent long-term strategic path.

Olaplex Holdings Business Overview & Revenue Model

Company Description

Olaplex Holdings, Inc. manufactures and sells hair care products. The company offers hair care shampoos and conditioners for use in treatment, maintenance, and protection of hair. It provides hair care products to professional hair salons, retailers, and everyday consumers. The company was founded in 2014 and is based in Santa Barbara, California.

How the Company Makes Money

Olaplex generates revenue primarily through the sale of its hair care products, which are distributed through professional salons and retail channels. The company operates a dual revenue model: direct sales to professional hair salons and sales through retail partners, including e-commerce platforms. Key revenue streams include sales of its core products, particularly the Olaplex No. 1 through No. 8 line, which has gained significant traction in both the professional and consumer markets. Additionally, Olaplex collaborates with salons to provide training and support for stylists, enhancing the brand's presence and driving product adoption. The company also benefits from a strong brand reputation and customer loyalty, which contribute to repeat purchases and sustained sales growth.

Olaplex Holdings Financial Statement Overview

Summary

Olaplex Holdings shows a mixed financial performance. Strong gross margins and improved leverage are positive, but profitability challenges and declining operational margins are concerning. Positive cash flow trends offer some optimism.

Income Statement

Olaplex Holdings has shown a mixed performance in its income statement. The TTM data indicates a slight revenue growth of 0.56%, but the company is currently experiencing a negative net profit margin of -0.30%, indicating a loss. The gross profit margin remains strong at 68.90%, suggesting efficient production processes. However, the declining EBIT and EBITDA margins over the years highlight challenges in operational efficiency and cost management.

Balance Sheet

The balance sheet shows a moderate financial position with a debt-to-equity ratio of 0.40 in the TTM, indicating a decrease in leverage compared to previous years. However, the return on equity is negative at -0.15%, reflecting the recent net loss. The equity ratio stands at 57.64%, suggesting a stable capital structure with a reasonable proportion of equity financing.

Cash Flow

Cash flow analysis reveals a positive trajectory with a free cash flow growth rate of 5.75% in the TTM. The operating cash flow to net income ratio is 0.84, indicating that the company generates sufficient cash from operations relative to its net income. The free cash flow to net income ratio is nearly 1, suggesting efficient cash conversion from profits.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	418.58M	422.67M	458.30M	704.27M	598.37M	282.25M
Gross Profit	278.06M	292.29M	318.63M	519.55M	473.82M	179.59M
EBITDA	91.91M	143.39M	186.77M	398.34M	385.70M	131.78M
Net Income	-4.95M	19.52M	61.59M	244.07M	220.78M	39.28M
Balance Sheet
Total Assets	1.51B	1.77B	1.74B	1.70B	1.56B	1.33B
Cash, Cash Equivalents and Short-Term Investments	286.38M	585.97M	466.40M	322.81M	186.39M	10.96M
Total Debt	352.10M	650.46M	655.77M	662.77M	758.20M	775.48M
Total Liabilities	625.47M	893.32M	895.37M	916.72M	1.04B	802.16M
Stockholders Equity	888.75M	874.40M	844.97M	780.96M	524.30M	530.67M
Cash Flow
Free Cash Flow	72.42M	138.18M	173.92M	254.67M	198.26M	128.95M
Operating Cash Flow	75.65M	143.07M	177.53M	255.32M	200.03M	128.97M
Investing Cash Flow	-13.81M	-4.89M	-3.61M	-2.68M	-6.26M	-1.38B
Financing Cash Flow	-314.29M	-18.61M	-30.33M	-116.22M	-18.34M	1.26B

Olaplex Holdings Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1.65
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For OLPX, the sentiment is Positive. The current price of 1.65 is above the 20-day moving average (MA) of 1.44, above the 50-day MA of 1.26, and above the 200-day MA of 1.32, indicating a bullish trend. The MACD of 0.11 indicates Negative momentum. The RSI at 65.11 is Neutral, neither overbought nor oversold. The STOCH value of 65.73 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for OLPX.

Olaplex Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ULTA	78 Outperform	$29.45B	25.44	47.97%	―	5.45%	4.28%
SBH	76 Outperform	$1.54B	8.32	27.54%	―	-0.42%	31.64%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
CHWY	61 Neutral	$13.31B	66.22	59.58%	―	9.80%	-46.84%
OLPX	57 Neutral	$1.09B	-215.79	-0.56%	―	-3.47%	-111.68%
ETSY	57 Neutral	$6.08B	43.05	―	―	1.98%	-20.98%
BBWI	53 Neutral	$4.71B	7.08	―	4.16%	-1.04%	-20.88%