On Wednesday, Truist Securities adjusted its financial outlook for Oddity Tech Ltd (NASDAQ:ODD) shares, raising the price target to $60 from $58 while maintaining a Buy rating on the company's stock. The adjustment comes in anticipation of the company's upcoming product launches, which are expected to have a significant impact on future revenues and margins.
The firm's analyst provided insights into the revised forecast, stating that the fiscal year 2025 (FY25) estimates are being refined to account for the scheduled launch of Brand 3 and the potential debut of Brand 4 in the second half of 2025.
The new projections include an increase in the gross margin estimate to 69.0%, up from the previous 67.0%. This is a slight decrease from the estimated 71% in fiscal year 2024 (FY24). Additionally, the adjusted forecast anticipates an AEBITDA margin of 20.7%, up from the earlier estimate of 18.9%.
The analyst elaborated that the updated estimates take into consideration the impact of the product launches in the latter half of the year, as opposed to the full-year impact previously expected. Despite these changes, the revenue projections for FY25 remain the same.
The revised price target of $60, up from the prior $58, reflects the firm's confidence in Oddity Tech's growth prospects following the launch of its new brands. The analyst's updated financial model suggests that the company's strategic moves will positively affect its bottom line in FY25, justifying the increased price target for the tech company's shares.
In other recent news, consumer tech company ODDITY Tech Ltd. has announced a share buyback program worth $150 million, alongside a robust financial outlook for the second quarter of 2024.
With an expected net revenue of approximately $189 million, a growth of 25% year-over-year, and a gross margin of around 71.0%, the company's financial strategy focuses on reinvesting in the business, mergers and acquisitions, and share buybacks. In response to a short seller report by NINGI Research, ODDITY clarified that its Israeli brick-and-mortar operations contribute to less than 5% of net revenue and EBITDA.
Analysts from KeyBanc Capital Markets, Barclays (LON:BARC) Capital Inc., and JMP Securities maintained positive ratings, while Evercore ISI initiated coverage with an Outperform rating. These recent developments underscore ODDITY's commitment to innovation and expansion in the beauty and wellness markets.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.