Why Oddity Tech Stock Rallied Today
Key Points
Oddity's sales and profits are growing at an impressive clip.
Management sees further gain ahead.
- 10 stocks we like better than Oddity Tech ›
Shares of Oddity Tech (NASDAQ: ODD) rose on Thursday after the skincare specialist delivered third-quarter earnings that surpassed investors' expectations.
As of 12:20 p.m. EST, Oddity's stock price was up more than 10%.
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Oddity reported strong third-quarter growth metrics
Oddity's net revenue jumped 24% year over year to $148 million. The gains were driven by double-digit growth in online sales for the company's Il Makiage makeup and SpoiledChild skincare brands.
Better still, Oddity's gross margin improved to 71.6%, up from 69.9% in the prior-year period. Oddity's adjusted net income, in turn, leaped 26% to $25 million, or $0.40 per share. That was well above Wall Street's estimates, which had called for per-share profits of $0.35.
"Oddity delivered strong third-quarter results, including financial performance that once again exceeded our guidance across revenue, profit, and earnings per share," CEO Oran Holtzman said in a press release.
A new telehealth platform should drive further gains
These strong results and promising early sales trends in the fourth quarter prompted Oddity to lift its full-year sales and profit guidance. Management now expects net revenue of $806 million to $809 million, representing growth of 24% to 25%, up from a prior forecast of $799 million to $804 million. The company also boosted its adjusted earnings per share target to $2.10-$2.12, up from $2.06-$2.09.
Oddity also touted the recent launch of Methodiq. The telehealth platform provides customized dermatology treatments for common skin conditions such as acne, hyperpigmentation, and eczema.
"Our goal with Methodiq is to transform a broken medical care system with precise treatments, pioneering technology, and the highest standard of care," Holtzman said.
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Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
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