With the popular hair-care brand now after reporting its earnings, we look at exactly how you can purchase shares in Olaplex.
I won't lie; when I saw Olaplex (NASDAQ: OLPX) was going public last September, I got pretty excited as it's one of my favorite beauty products of all time. If you have ever bleached your hair and visited a salon, it's likely that your hairdresser recommended it. Alternatively, if you searched "Help, how do I save my broken hair after going blonde?!", Google would have likely pointed you towards countless blogs telling you the benefits of Olaplex.
After raising close to $1.6 billion as part of its September IPO, the company is now set to report its second-ever quarterly earnings report very soon.
What is Olaplex?
Olaplex is a cult-followed hair products company that has become very popular since it launched in 2014. While other shampoo and treatment brands focused on hair's outer appearance, promising glossy and healthy-looking locks, Olaplex did something different by offering products that repaired the hair follicles bond.
Beauty customers flocked to the brand when they realized that to get truly healthy hair, they had to start from within and repair the broken bonds in their hair caused by heat damage, bleaching, and general styling - and that's exactly what Olaplex delivered.
The company enjoys massive brand loyalty from its customers and is often recommended to use by professional stylists. Olaplex is often trending on TikTok and is favored by beauty gurus and influencers for its award-winning bond repaid technology.
It offers shampoos, conditioners, hair masks, oils, and many other products. (However, in my experience as someone who regrettably went from brunette to blonde, Olaplex's holy grail product is their number 3 hair perfector.)
When did Olaplex go public?
Olaplex made its stock market debut on Thursday, September 30 on the Nasdaq under the ticker 'OLPX.' It sold its shares at a price of $21 as part of its IPO, but shares are now trading at $16.81 following a number of volatile months.
Olaplex's financials
Olaplex is owned by Advent International, a private equity firm, which bought the blonde builder expert in January 2020. After its IPO, Advent maintained 78.2% of Olaplex, according to a prospectus.
Unlike many other firms making a stock market debut, Olaplex was already profitable prior to its IPO. In the first half of 2021, its net income jumped to $94.9 million year-over-year (YoY) from a net loss of $22.4 million. Its net income for the entirety of 2021 came in at $221 million -- a 462.1% change YoY. The company's science-backed solutions have also seen it increase annual net sales by 112% to $598 million as of its latest earnings report.
The business is expecting sales for the coming fiscal year to range between $796 million and $826 million. These relatively strong financials place Olaplex in a better position than other similar young companies. This is likely a factor that drove bullish sentiment over the company's IPO.
Despite this, Olaplex is down over 26% since joining the public market. Widespread market volatility and bearish sentiments associated with a lot of 2021 IPO's could be driving this downturn.
Olaplex's growth potential
Olaplex's products are very popular and demand is continuing to rise. The company is really benefiting from the trend of consumers becoming more concerned with keeping their hair healthy.
Last year, the global haircare space was estimated to be worth a whopping $77 billion and is expected to grow 6% compounded annually between 2020 to 2025. This proves that Olaplex has a massive market to address which will boost sales.
In other positive news, around 76% of professional hairstylists say that Olaplex is of higher quality than other rival brands. In 2021, its adjusted EBITDA rose to $409 million from $199 million in the previous year, and professionals attributed 34.3% of Olaplex's total net sales. Professionals buying it proves that this is a high-standard product.
Plans to enter the skincare market could also open up another lucrative revenue stream for the company, with skincare reportedly worth $140 billion a year globally.
