Canaccord upgrades Olaplex betting on brand revival and return to growth
Investing.com -- Canaccord upgraded Olaplex to Buy from Hold and raised its price target to $2 from $1.50, saying the prestige haircare brand is showing signs of recovery after more than two years of sales declines.
The brokerage said Olaplex has stabilized its business and is positioned to return to growth as investments in marketing, merchandising and innovation take hold.
The company reported second-quarter sales growth for the first time in 10 quarters, and management reiterated its guidance for fiscal 2025 of flat to slightly positive sales, despite a weaker macro backdrop.
Olaplex’s adjusted EBITDA margins have normalized from above 60% during its early surge to the low-20% range, more in line with industry peers.
Canaccord said the stock remains attractively valued at about 11 times forward EBITDA, compared with roughly 15 times for other beauty companies, leaving room for multiple expansion as growth becomes more consistent.
The firm noted that Olaplex’s refreshed brand image and improved merchandising have been well received across professional, retail and consumer channels, with more disciplined inventory management helping reduce heavy discounting.
Circana data showed positive momentum in third-quarter sales trends after nine straight quarters of declines.
Broader category dynamics also support Olaplex, Canaccord said, pointing to accelerating demand in U.S. prestige haircare, where sales rose 6% in the first half of 2025.
Growth in styling and scalp care, areas where Olaplex has expanded, and steady demand in the professional salon channel provide a strong base for the brand.
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