NEW YORK, Nov. 18, 2022 (GLOBE NEWSWIRE) — Gainey McKenna & Egleston announces that a securities class action lawsuit has been filed in the Central District of California on behalf of purchasers of Olaplex Holdings, Inc. securities. OLPX pursuant to and/or traceable to the Company’s initial public offering on September 30, 2021 (the “IPO”).

According to the lawsuit, the defendants made false and/or misleading statements and/or failed to disclose that: (i) macroeconomic pressures and competition in the hair care market were more resilient than Olaplex presented to investors; (ii) accordingly, Olaplex was unlikely to maintain its sales and earnings momentum; and (iii) as a result, it was unlikely that Olaplex would be able to achieve the financial and operational growth projected in the IPO offering documents.

On September 29, 2022, a Piper Sandler analyst downgraded Olaplex to Neutral from Overweight, stating that her work found that “competition and misinformation pose growing risks to the company [Olaplex].” Additionally, the analyst noted that she expects investments in marketing and education to be needed to offset the negative developments and that “given the risks at play, there is little room for an upside rating.” On these On the news, Olaplex’s stock price fell more than 12%.

Then, on October 18, 2022, Olaplex revised its guidance for fiscal 2022. Specifically, Olaplex said it now expects fiscal 2022 revenue to be between $704 million and $711 million, well below its previous guidance range of $796 million up to 826 million US dollars. Olaplex further stated that Olaplex’s “updated guidance primarily reflects a slowing in sales momentum, which it attributes to macroeconomic pressures, increased competitive activity, including rebates, and a moderation in new customer acquisition and inventory rebalancing among certain customers.” [Olaplex] believes this is in response to the same macroeconomic pressures.” Following this news, Olaplex stock is…