Olaplex Holdings, Inc.
The law firm of Kirby McInerney LLP announces that a class action lawsuit has been filed in the U.S. District Court for the Central District of California on behalf of those who acquired Olaplex Holdings, Inc. (“Olaplex” or the “Company”) (NASDAQ: OLPX) securities pursuant and/or traceable to the Registration Statement and Prospectus (collectively, the “Registration Statement”) issued in connection with Olaplex’s October 1, 2021 initial public offering (“IPO”); and/or (b) that purchased or otherwise acquired Olaplex securities during the period from September 30, 2021 through November 17, 2022 (the “Class Period”). Investors have until January 17, 2023 to apply to the Court to be appointed as lead plaintiff in the lawsuit.
Olaplex manufactures personal care products such as hair oil, shampoo, conditioner, perfector, and other related products.
On October 1, 2021, Olaplex conducted its IPO, selling 73.7 million shares at $21.00 per share.
On September 29, 2022, a Piper Sandler analyst downgraded Olaplex to Neutral from Overweight, stating that her work revealed that “competition and misinformation pose growing risks to the company.” In addition, the analyst indicated that she anticipated investments in marketing and education were needed to offset the headwinds and that “little room for valuation upside given the risks at play.” On this news, the price of Olaplex shares declined by $1.33 per share, or approximately 12.15%, from $10.95 per share to close at $9.62 on September 29, 2022.
On October 18, 2022, Olaplex issued a press release in which “the Company revised its guidance for the 2022 fiscal year”. Olaplex said it now expects fiscal year 2022 revenue between $704 million and $711 million, significantly down from its prior guidance range of $796 million to $826M. Olaplex stated that “[t]he Company’s updated guidance primarily reflects a slowdown in sales momentum that it attributes to macro-economic pressures, increased competitive activity including discounting, and a moderation in new customer acquisition, as well as inventory rebalancing across certain customers which the Company believes are in response to these same macro-economic pressures.” On this news, the price of Olaplex shares declined by $5.55 per share, or approximately 56.59%, from $9.79 per share to close at $4.24 on October 19, 2022.
At the time of the filing of the complaint, the price of Olaplex common stock has remained significantly below the IPO price. On November 17, 2022, Olaplex shares closed at $5.75 per share.
The lawsuit alleges that, throughout the Class Period, Defendants made false and/or misleading statements and/or failed to disclose that: (i) macroeconomic pressures and competition in the haircare market were more robust than the Company had represented to investors; (ii) accordingly, the Company was unlikely to maintain its sales and revenue momentum; and (iii) as a result, it was unlikely that the Company would be able to achieve the financial and operational growth projected in the Offering Documents.