GICS Sector : Technology
Waldencast Acquisition Corp.a skin care company, provides advanced skin care treatments.Its products are designed to help minimize the appearance of premature skin aging, skin damage, hyperpigmentation, acne, and sun damage primarily available through dermatologists, plastic surgeons, medical spas, and other skin care professionals.
Waldencast plc reported its Q1 2025 financial results, showing a mixed bag of progress and challenges. Net revenue came in at $65.4 million, down 4.1% year-over-year, reflecting a tough macroeconomic environment. Adjusted gross profit margin improved to 76.4%, while adjusted EBITDA was $4.4 million, representing a 6.7% margin. EPS came in at -0.18, missing the consensus estimate of -0.05. Despite the top-line decline, the company remains optimistic about achieving its fiscal 2025 targets, including mid-teens net revenue growth and mid-to-high-teens adjusted EBITDA margin.
Publication Date: May -14
Milk Makeup's revenue declined 15.1%, impacted by tough international comparisons and inventory adjustments. However, the brand delivered strong domestic performance, driven by the successful launch of Hydro Grip Gel Skin Tint, which sold out quickly and contributed to high single-digit growth in U.S. retail sales. The brand also expanded its distribution with a strong launch at Ulta Beauty. Management highlighted the brand's ability to leverage earned media, with Hydro Grip generating $18 million in earned media value. A new partnership with Nike further broadens its reach, reinforcing Milk Makeup's position as a next-generation beauty brand.
Obagi Medical delivered a 7.1% revenue increase to $36.2 million, with adjusted gross profit margin improving to 82%. However, supply chain disruptions caused stockouts of key SKUs, which impacted growth. The brand is undergoing a supply chain transformation to enhance operational efficiency and support long-term growth. Obagi continues to strengthen its leadership in professional skin care, focusing on innovation and addressing key skin concerns. Recent product launches, including ELASTIderm Lift Up & Sculpt Facial Moisturizer and the Retinol and PHA Refining Night Cream, are well-positioned to attract new consumers with clinically proven results.
Supply chain restructuring is underway to improve flexibility and responsiveness, addressing long lead times and inventory disruptions. Despite these efforts, Q1 saw stockouts in key items, impacting growth. The physician channel remains robust, with no slowdown in demand, though growth was affected by the normalization of Amazon sales post-distributor conversion. The company is also mitigating tariff impacts through selective pricing and operational adjustments.
Waldencast's valuation metrics reflect a mixed picture. The stock trades at a P/S ratio of 1.45 and an EV/EBITDA of 3.79, indicating moderate valuation relative to its peers. The company's net debt of $172.1 million, or 1.46x EBITDA, reflects recent refinancing activities. Management remains confident in its ability to deliver on its 2025 outlook, supported by operational scale, a talented team, and a balanced portfolio in attractive beauty segments. Analysts estimate 15.8% revenue growth for next year, aligning with the company's mid-term targets.
Obagi Medical Shares New Clinical Data on Obagi Hyaluronic Acid Injectables and Nu-Cil Scalp Serum at the 2025 American Society for Dermatologic Surgery Annual Meeting
Nov -16
Waldencast plc strengthens balance sheet position with the announcement of a trademark sale for Japan and refinancing of its credit facilities
Nov -14
Waldencast plc Provides Information Regarding Upcoming Earnings Release Dates
Nov -12
Obagi Medical Launches Nu-Cil® BioStim™ Scalp Serum
Oct -08
Waldencast Announces FDA Approval of Obagi® saypha® MagIQ™ Injectable Hyaluronic Acid Gel Under the Obagi Medical Brand
Sep -10
Waldencast Announces Strong Progress on Business Priorities for H1 2025 and Initiatives to Drive Transformation
Aug -18
Waldencast Acquires Novaestiq Corp. and U.S. Rights to Leading Injectable Hyaluronic Acid Gel Line, Saypha®, Under the Obagi Medical Brand
Jul -23
Squarepoint Ops LLC Decreases Position in Waldencast plc (NASDAQ:WALD)
Jun -11
Obagi Skincare's 15% growth is driven by increasing demand for premium skincare products, particularly among the 40-60 age demographic. Strong brand recognition, expanded distribution channels, and innovative product launches also contribute to growth. Additionally, Waldencast's strategic acquisitions and investments in digital marketing have enhanced Obagi's online presence, further fueling sales.
Milk Makeup's 12% growth is driven by increasing demand for clean beauty products, strong e-commerce presence, and influencer marketing. The brand's trendy, cruelty-free, and vegan-friendly products resonate with Gen Z consumers. Waldencast's strategic acquisition has also expanded Milk Makeup's distribution channels, further fueling growth.
Obagi is a skincare brand that offers a range of products that help to address various skin concerns such as aging, hyperpigmentation, and acne.
Dermalogica is a professional skincare brand that offers a wide range of products that cater to different skin types and concerns.
Perricone MD is a skincare brand that offers a range of products that are formulated with powerful antioxidants and nutrients to address various skin concerns.
Waldencast is a platform that offers a range of skincare and beauty products from various brands, including Obagi, Dermalogica, and Perricone MD.
Bloomreach is a digital commerce platform that helps businesses to create personalized and seamless shopping experiences for their customers.
Waldencast plc operates in a niche market with limited substitutes, reducing the threat of substitutes.
Waldencast plc's customers have limited bargaining power due to the company's strong brand reputation and limited alternatives.
Waldencast plc's suppliers have moderate bargaining power due to the company's dependence on a few key suppliers.
The beauty and wellness industry is highly competitive, and new entrants can easily disrupt the market, posing a high threat to Waldencast plc.
The beauty and wellness industry is highly competitive, with many established players, leading to a high intensity of rivalry for Waldencast plc.
| Value | |
|---|---|
| Debt Weight | 20.61% |
| Debt Cost | 3.95% |
| Equity Weight | 79.39% |
| Equity Cost | 1.08% |
| WACC | 1.67% |
| Leverage | 25.97% |
Value: 4.4
Growth: 2.3
Quality: 5.5
Yield: 0.0
Momentum: 10.0
Volatility: 3.3
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