WALD Stock Forecast & Price Target

Waldencast PLC has demonstrated solid growth momentum, with a 5.6% year-over-year sales increase in Q2, driven by both the Milk Makeup and Obagi brands, and reacceleration to 10.1% growth in Q3, highlighting resilience in eCommerce and international markets. The company is capitalizing on strategic initiatives such as the introduction of Milk Makeup on Amazon's Premium Beauty platform and reduced out-of-stock issues for Obagi, suggesting operational improvements. Additionally, consumption growth for Milk Makeup in the U.S. has outpaced the overall prestige beauty market, rising 12% year-to-date, which positions Waldencast favorably within a competitive landscape.

Waldencast PLC has revised its FY25 outlook downwards, projecting flat revenue with an adjusted EBITDA margin in the high single digits, indicating a concerning stagnation in financial performance. The consolidated adjusted gross margin has declined significantly by 310 basis points year-over-year to 71.9%, which is notably lower than the market consensus expectation of a modest decline. Furthermore, while Obagi has shown some resilience with a 10.1% year-over-year growth, the substantial 20% year-over-year decline in Milk Makeup sales has negatively impacted overall revenue, contributing to a total sales decrease of 3.4% year-over-year, reflecting broader operational challenges for the company.