WALD Stock Forecast & Price Target

Waldencast PLC demonstrated a solid growth trajectory, with the company reporting a 5.6% year-over-year increase in sales for the second quarter, highlighting resilience in both its Milk Makeup and Obagi brands. Notably, the reacceleration of brand growth in the third quarter, up 10.1%, was driven by eCommerce and international expansion, indicating strong demand for its products despite distribution adjustments. Additionally, Milk Makeup's performance was bolstered by its entry into the Amazon Premium Beauty platform and innovation in product offerings, which contributed to significant consumption growth that outpaced the broader prestige beauty market.

Waldencast PLC has revised its financial outlook for FY25, indicating expectations of flat revenue and a high single-digit adjusted EBITDA margin, which reflects a significant reduction from prior forecasts. The company's consolidated adjusted gross margin has declined by 310 basis points year-over-year to 71.9%, negatively impacted by both its Obagi Medical and Milk Makeup segments, with the latter experiencing a substantial 20% year-over-year decline in sales. Overall, total sales decreased by 3.4% year-over-year, driven primarily by ongoing weaknesses in the Milk Makeup brand, further exacerbated by lower consumption in international markets.