SAN DIEGO, Nov. 23, 2022 (GLOBE NEWSWIRE) —
The Class: Robbins LLP reminds investors that a shareholder filed a class action on behalf of all persons and entities that purchased or otherwise acquired Olaplex Holdings, Inc. (NASDAQ: OLPX) common stock pursuant and/or traceable to the Company’s September 30, 2021 initial public offering (“IPO”) for remedies pursuant to the Securities Act of 1933. Olaplex manufactures and sells haircare products.
What Now: Similarly situated shareholders may be eligible to participate in the class action against Olaplex. Shareholders who want to be appointed lead plaintiff for the class must file their papers by January 17, 2023. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. You do not have to participate in the case to be eligible for a recovery. For more information, click here.
All representation is on a contingency fee basis. Shareholders pay no fees or expenses.
What is this Case About: Olaplex Holdings, Inc. (OLPX) Made False and Misleading Statements in its IPO Offering Documents
According to the complaint, Olaplex issued 73,700,000 shares of common stock in its IPO at $21.00 per share, raising approximately $1,466,445,750. The Offering Documents emphasized brand loyalty and its competitive advantage. However, the Offering Documents failed to disclose that macro-economic pressures and competition in the haircare market were more robust than the Company had represented to investors. Accordingly, the Company was unlikely to maintain its sales and revenue momentum and was therefore unable to achieve the financial and operational growth projected in the Offering Documents.
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, Olaplex’s stock price fell $1.33 per share, or 12.15%, to close at $9.62 per share on September 29, 2022.
Then, on October 18, 2022, Olaplex issued a press release revising 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, Olaplex’s stock price fell $5.55 per share, or 56.69%, to close at $4.24 per share on October 19, 2022. The Company’s stock continues to trade well below the IPO prices.
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