WALD Stock Forecast & Price Target

Waldencast PLC demonstrated a solid upward trajectory in sales, with a reported 5.6% year-over-year growth in the second quarter, despite shortfalls compared to estimates and consensus. The company’s performance continues to gain momentum, particularly in the third quarter, with a reported 10.1% growth driven by strong e-commerce and international sales efforts, as well as innovations such as the Hydro Grip Gel Tint from the Milk Makeup segment. Furthermore, Milk Makeup significantly outperformed the broader prestige beauty market, with a year-to-date consumption growth of 12%, highlighting the brand's competitive positioning and the potential for continued revenue expansion moving forward.

Waldencast PLC has significantly reduced its FY25 outlook, now forecasting flat revenue and an adjusted EBITDA margin of high single digits, which indicates a lack of anticipated growth. The company's consolidated adjusted gross margin contracted by 310 basis points year-over-year to 71.9%, falling short of expectations, driven by a decline in both the Obagi and Milk Makeup segments. Notably, total sales decreased by 3.4% year-over-year, primarily due to a steep 20% decline in Milk Makeup sales, overshadowing the positive growth from the Obagi brand.