One-glance verdict
Undervalued
$2.89 our estimate vs market $2.07
Wall Street consensus: $1.98 (-31.4% lower than our fair-value estimate)
28% below our estimate, below the bear case
Fundamentals snapshot
Olaplex Holdings, Inc.
OLPX · NMS · Consumer Cyclical · Specialty Retail
Current price
$2.07
52-week range
$0.99 - $2.08
Market cap
$1.39B
Balance sheet
Distressed
0.46x Concerning
Net debt $26.32M. Interest coverage shows how many times profit covers the interest bill.
What stands out
2 Rewards
3 Risks
2 rewards · 3 risks
- Reward Revenue grew 0.6% last year.
- Reward Free cash flow was positive in 6/10 years.
- Risk Operating margin compressed from 52.2% to -5.1% over 3 years.
- Risk Insider ownership is only 0.7% (peer median: 14.3%).
What this company does
Olaplex Holdings, Inc.
Olaplex sells high-end hair treatments, shampoos, and conditioners that are known for repairing damaged hair. The company makes money by selling its products to professional salons, through major beauty stores, and directly to shoppers online. Having these different sales channels (the various ways a company gets its products to customers) helps Olaplex reach more people and makes its business less reliant on any single partner for its sales.
How the company got here
Olaplex started in 2014, launching a hair treatment that created a new category called “bond-building,” which repairs damaged hair from the inside out. [2, 5, 9] It first sold its products exclusively to professional hairstylists, which built a strong reputation for the brand. [1, 2, 11] After its success in salons, the company was acquired by a private equity firm (a company that invests in other companies) in 2020 and then had an initial public offering (IPO, the first time a company sells its stock to the public) in 2021. [1, 2, 6] Following a period of very fast growth, the company faced challenges, including a decline in sales. [3] In late 2023, a new CEO, Amanda Baldwin, was brought in to lead a turnaround and stabilize the business. [3, 11, 12]
What it actually does
Olaplex creates and sells high-end hair care products based on a patented, science-backed technology. [5, 8] Its key ingredient works on a molecular level to repair broken bonds in the hair that are damaged by things like coloring, bleaching, and heat styling. [5] The product lineup includes treatments, shampoos, conditioners, styling oils, and masks that people can use at home or receive as a service in a salon. [1, 7] The products are designed to be used together as a complete routine to improve and maintain hair health. [5, 9]
Professional
This is the company's original and most established business, where it sells products to professional distributors, who then sell them to hair salons and licensed stylists. [1, 13, 15] Stylists use these products on clients during chemical treatments or as standalone services and also sell the take-home versions directly to their customers. [2] This channel is crucial for the company's credibility, as it creates brand advocates out of hair care experts. [1, 10] It currently represents a significant, though not the largest, portion of the company's sales. [10]
Specialty Retail
This part of the business involves selling products wholesale (in large quantities at a lower price) to major beauty retailers like Sephora and Ulta Beauty. [1, 3, 15] These retailers then sell Olaplex products in their physical stores and on their own e-commerce websites (online stores). [7, 13] This channel helps Olaplex reach a much broader audience of everyday shoppers who might not discover the brand in a salon. [5] This segment is a major contributor to the company's overall revenue (the total money earned from sales). [10]
Direct-to-Consumer (DTC)
In this channel, Olaplex sells its products directly to individual customers without a middleman. [1, 15] This happens through the company's own website, Olaplex.com, as well as on large third-party e-commerce platforms like Amazon. [13, 15] Selling directly allows the company to control the customer experience, from marketing to education, and to gather valuable data on shopping habits. [1] This is a growing part of the business and is similar in size to its other channels. [10]
What management is betting on now
The company's leadership is focused on a turnaround plan to return to steady growth. [3, 12] A top priority is strengthening its relationship with the professional stylist community through better education and support, viewing them as key influencers. [1, 3, 12] They are also refreshing the brand's image with new packaging and clearer marketing to make the products easier for shoppers to understand and to create a stronger emotional connection with customers. [11, 14] Finally, the company is focused on creating new products and expanding its international sales by revamping its global distribution network (the system of getting products to other countries). [1, 14]
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q2
$16.13M
FY2024 Q3
$33.33M
FY2024 Q4
$49.22M
FY2025 Q1
$-2.96M
FY2025 Q2
$20.80M
FY2025 Q3
$7.93M
FY2025 Q4
$32.56M
FY2026 Q1
$7.35M
Revenue
$99.37M
Net income
$-5.29M
Diluted EPS
-0.01
Operating cash flow
$7.50M
Free cash flow
$7.35M
Fetching…
Sources
Revenue
$105.12M
Net income
$-13.10M
Diluted EPS
-0.02
Operating cash flow
$32.67M
Free cash flow
$32.56M
Fetching…
Sources
Revenue
$114.58M
Net income
$11.13M
Diluted EPS
0.02
Operating cash flow
$8.00M
Free cash flow
$7.93M
Fetching…
Sources
Revenue
$106.28M
Net income
$-7.74M
Diluted EPS
-0.01
Operating cash flow
$20.90M
Free cash flow
$20.80M
Fetching…
Sources
Revenue
$96.98M
Net income
$465.00K
Diluted EPS
0.00
Operating cash flow
$-2.92M
Free cash flow
$-2.96M
Fetching…
Sources
Revenue
$100.74M
Net income
$-8.80M
Diluted EPS
-0.01
Operating cash flow
$49.66M
Free cash flow
$49.22M
Fetching…
Sources
Revenue
$119.08M
Net income
$14.80M
Diluted EPS
0.02
Operating cash flow
$33.46M
Free cash flow
$33.33M
Fetching…
Sources
Revenue
$103.94M
Net income
$5.78M
Diluted EPS
0.01
Operating cash flow
$16.24M
Free cash flow
$16.13M
Fetching…
Sources
Is it cheap or expensive?
Fair value $2.89 vs current price $2.07
Wall Street consensus is the average analyst price target: $1.98 (-31.4% lower than our fair-value estimate).
Our most-likely fair value is $2.89 a share — about 39.4% above today's price of $2.07, so the stock currently looks cheap (undervalued).
Is it drowning in debt?
Distressed
Net debt $26.3M. Interest coverage 0.5x.
Net debt
$26.32M
Interest coverage
0.46x
Olaplex Holdings, Inc.'s profit covers its interest bill about 0.5 times over. which is stronger than most peers shown here and 2 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Distressed
Worse cushion
Baseline
Better cushion
OLPX
BASELINE
Olaplex Holdings, Inc.
Total debt $352.48M Interest coverage 0.46x This is the baseline the peer rows are being compared against.
Total debt $916.90M Interest coverage 3.22x +598% vs OLPX Carries about 7.0x more debt cushion than OLPX.
Total debt $609.02M Interest coverage 7.01x +1,420% vs OLPX Carries about 15.2x more debt cushion than OLPX.
Total debt $11.76M Interest coverage -53.17x -100% vs OLPX This peer has almost no interest-payment cushion compared with OLPX.
Total debt $3.42B Interest coverage 2.34x +407% vs OLPX Carries about 5.1x more debt cushion than OLPX.
Total debt $149.01M Interest coverage -2.59x -100% vs OLPX This peer has almost no interest-payment cushion compared with OLPX.
What you should know
The case for and against OLPX
2 Rewards
3 Risks
Rewards
-
Revenue grew 0.6% last year.
-
Free cash flow was positive in 6/10 years.
Risks
-
Operating margin compressed from 52.2% to -5.1% over 3 years.
-
Insider ownership is only 0.7% (peer median: 14.3%).
-
Return on equity was -1.7% last year — the company lost money on shareholders' equity.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
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Forward P/E
20.82x
P/B
1.58x
P/S
3.27x
EV/EBITDA
26.37x
PEG ratio
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Profitability
How much profit each dollar creates
Gross margin
72.4%
Operating margin
-5.1%
Net margin
-3.5%
ROE
-1.7%
ROA
0.1%
Health
Liquidity and balance-sheet strength
Debt / equity
0.40x
Current ratio
6.27x
Quick ratio
5.11x
Total debt
$352.48M
Total cash
$326.17M
Growth
How the business has been compounding
Revenue TTM
$425.35M
Revenue 5Y CAGR
-8.3%
EPS TTM
-0.02
EPS 5Y CAGR
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Cash flow
How much cash the business throws off
Operating CF TTM
$69.08M
Free CF TTM
$58.33M
FCF margin
13.7%
Dividend
Shareholder payout
Yield
—
Payout ratio
0.0%
Last ex-div date
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