WALD Stock Forecast & Price Target

Waldencast PLC has demonstrated a positive growth trajectory, reporting a sales increase of 5.6% year-over-year in the second quarter, driven by both the Obagi and Milk Makeup segments. The company's growth reaccelerated to 10.1% in the third quarter, largely fueled by eCommerce and international expansion strategies, despite ongoing rationalization of distribution points. Furthermore, Milk Makeup has outperformed the prestige beauty market with a 12% consumption growth in the U.S. year-to-date, indicating strong brand performance and market positioning.

Waldencast PLC has downgraded its FY25 outlook, projecting flat revenue and a lower adjusted EBITDA margin, indicating a significant reduction in growth expectations. The company's consolidated adjusted gross margin has contracted by 310 basis points year-over-year to 71.9%, primarily due to underperformance in the Milk Makeup segment, which saw a 20% year-over-year sales decline. Despite a 10.1% year-over-year growth in the Obagi brand, overall sales decreased by 3.4% year-over-year, driven by continuing weakness in the Milk Makeup brand and disappointing results from international markets.