Oddity Tech Ltd. (NASDAQ:ODD) is one of the best NASDAQ stocks to buy in 2026. On December 12, JPMorgan analyst Cory Carpenter lowered the firm’s price target on Oddity to $59 from $67, while keeping an Overweight rating on the shares. As part of its 2026 market forecast, the firm updated its investment ratings and price targets for companies within the small- and mid-cap internet and video game sectors. Oddity Tech Ltd. (NASDAQ:ODD) saw a 24% year-over-year revenue increase to $148 million in Q3 2025. T ...

Company Overview - Oddity Tech, trading under NASDAQ:ODD, is recognized for its innovative beauty brands, Il Makiage and SpoiledChild, which have gained popularity due to their strong online presence and unique product offerings [1] - The company operates in the competitive beauty and skincare industry, facing competition from major players like Estée Lauder and L'Oréal [1] Financial Performance - Oddity's net revenue increased by 24% year over year, reaching $148 million, driven by strong online sales for its brands [3] - The company's gross margin improved to 71.6%, up from 69.9% the previous year, indicating effective cost management [3][6] - Adjusted net income soared by 26% to $25 million, or $0.40 per share, surpassing Wall Street's forecast of $0.35 per share [4][6] Market Activity - Following a price target set by Truist Financial at $80, indicating a potential increase of about 84.71%, ODD shares surged over 10% by midday [2][6] - The current stock price is $39.57, reflecting a 6.49% increase, with a market capitalization of approximately $2.25 billion [5]

Financial Data and Key Metrics Changes - ODDITY reported a 24% year-over-year revenue growth in Q3, reaching $148 million, exceeding guidance of 21% to 23% growth [16][19] - Adjusted diluted earnings per share increased to $0.40, surpassing guidance of $0.33 to $0.36 [18] - Gross margins expanded to 71.6%, up 170 basis points from the previous year, exceeding guidance of 68% [17] Business Line Data and Key Metrics Changes - Il Makiage experienced double-digit online revenue growth, with a target of $1 billion revenue by 2028 [11] - SpoiledChild is expected to generate $225 million in revenue for 2025, showing strong performance [12] - METHODIQ, the new brand, aims to launch 28 products addressing various skin conditions, with a focus on dermatology [8][9] Market Data and Key Metrics Changes - International revenue increased approximately 40% year-over-year in the first nine months of 2025, with significant growth in existing markets like the U.K. and Australia [11][24] - The U.S. still accounts for 83% of total revenue, indicating room for international expansion [23] Company Strategy and Development Direction - ODDITY is focused on expanding its international presence while responsibly managing growth across brands and geographies [23] - The company aims to leverage technology and innovation, particularly through ODDITY Labs, to enhance product offerings and consumer experience [14][52] - METHODIQ is positioned to transform the medical care system by providing high-efficacy treatments without traditional barriers [6][7] Management's Comments on Operating Environment and Future Outlook - Management acknowledged challenges in the industry but emphasized strong financial performance and growth potential [5][16] - The company raised its full-year guidance, expecting net revenue between $806 million and $809 million for 2025, representing 24% to 25% growth [19] - Management remains optimistic about the consumer environment, citing strong repeat purchase rates as a buffer against acquisition cost increases [40] Other Important Information - ODDITY plans to launch a major media campaign for METHODIQ, including a significant TikTok activation [10][89] - The company has a strong cash position with $793 million in cash and equivalents, plus $200 million available on undrawn credit facilities [19][60] Q&A Session Summary Question: Can you unpack the 40% year-to-date growth in international markets? - Management noted that 83% of revenue still comes from the U.S., with international growth primarily from existing markets like Canada and the U.K. [23][24] Question: How does METHODIQ plan to attract new customers? - METHODIQ is expected to draw customers from existing brands while also focusing on user acquisition [27] Question: What is the growth outlook for Il Makiage and SpoiledChild? - Management aims for sustained 20% growth across brands, with Il Makiage targeting $1 billion by 2028 [75] Question: How is the company addressing higher acquisition costs? - Management highlighted strong repeat purchase rates as a key factor in offsetting higher acquisition costs [40] Question: What is the financial profile of METHODIQ? - METHODIQ is expected to have a similar long-term growth framework as Il Makiage and SpoiledChild, with a focus on repeat business [50] Question: How will the company leverage its physician network for METHODIQ? - The company is currently using third-party networks for physicians and plans to integrate technology to enhance treatment outcomes [67]

Financial Data and Key Metrics Changes - Oddity reported a 24% year-over-year revenue growth, reaching $148 million in Q3 2025, exceeding guidance of 21% to 23% [13][14] - Adjusted diluted earnings per share increased to $0.40, surpassing guidance of $0.33 to $0.36 [16] - Gross margins expanded to 71.6%, up 170 basis points from the prior year, exceeding guidance of 68% [15] - Adjusted EBITDA for the quarter was $29 million, above the guidance of $26 million to $28 million [16] - The company ended the quarter with $793 million in cash and cash equivalents, plus an additional $200 million available on undrawn credit facilities [17] Business Line Data and Key Metrics Changes - Il Makiage experienced double-digit online revenue growth, on track to achieve $1 billion in revenue by 2028 [9] - SpoiledChild is expected to generate $225 million in revenue for 2025, indicating strong performance [10] - International revenue increased approximately 40% year-over-year in the first nine months of 2025, with significant growth in existing markets like the U.K. and Australia [9][10] Market Data and Key Metrics Changes - The company noted that 83% of revenue still comes from the U.S., with international markets contributing 17% [20] - New geographic expansions include Italy, Spain, Netherlands, Ireland, Sweden, and Denmark, with testing in Japan, Mexico, and Korea [21][22] Company Strategy and Development Direction - The launch of Methodic, a telehealth platform, aims to transform the medical care system, starting with dermatology [5][6] - Methodic is expected to feature 28 products addressing various skin conditions, with a focus on high-efficacy treatments [6][7] - The company plans to continue investing in its long-term growth engines, including Methodic and ODDITY Labs [16][11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate a challenging industry backdrop, citing strong repeat customer rates as a buffer against acquisition cost increases [36] - The outlook for 2025 has been raised, with expected net revenue between $806 million and $809 million, representing 24% to 25% year-over-year growth [17] - Management remains bullish on Methodic's potential, emphasizing the unique market opportunity it presents [30][31] Other Important Information - The company is leveraging artificial intelligence and proprietary datasets to enhance its direct-to-consumer model [11] - Methodic's launch includes a significant media campaign, marking the largest TikTok activation in the company's history [8][9] Q&A Session Summary Question: Can you unpack the 40% year-to-date growth in international markets? - Management noted that while international growth is strong, 83% of revenue still comes from the U.S., and they plan to responsibly grow in international markets [20][21] Question: How is Methodic expected to drive new customer acquisition? - Management indicated that Methodic will attract both existing and new customers, with a mix of user acquisition strategies [25] Question: What are the expectations for SG&A in the context of the new brand launch? - Management stated that they are not ready to provide specific guidance for 2026 but expect Methodic to scale faster than SpoiledChild [29][32] Question: How does the company view the health of the U.S. consumer? - Management acknowledged softness in the consumer market but highlighted strong revenue and margin performance, driven by repeat customers [36] Question: What is the financial profile of Methodic? - Management expects Methodic to support long-term revenue growth and healthy unit economics, with lower gross margins initially due to prescription costs [44][45] Question: How will the company approach international expansion for Methodic? - Management confirmed that Methodic will initially focus on the U.S. market before considering international expansion [55]

Core Insights - ODDITY Tech Ltd. reported strong third quarter results for 2025, exceeding guidance in revenue, profit, and earnings per share, and is positioned for continued growth with new brand launches and investments in technology [2][3][4] Financial Performance - Third quarter net revenue reached $148 million, a 24% increase year-over-year from $119 million [4][6] - Gross profit for the third quarter was $106 million, up 27% from $83 million in the same period last year, with a gross margin of 71.6%, an increase of 170 basis points [4][6] - Adjusted EBITDA for the third quarter was $29 million, a 16% increase from $25 million year-over-year [4][6] - Net income for the third quarter was $18 million, consistent with the previous year, while adjusted net income rose to $25 million, a 26% increase from $20 million [4][6] Business Developments - The company successfully launched its new brand, METHODIQ, aimed at transforming the medical care system with advanced technology and precise treatments [2][5] - ODDITY is expanding its ODDITY LABS molecule discovery platform, indicating a focus on innovation and new product development [5] Financial Outlook - ODDITY raised its full-year 2025 financial outlook, projecting net revenue between $806 million and $809 million, representing a year-over-year growth of 24% to 25% [9][10] - The company anticipates a gross margin of approximately 72.5% and adjusted EBITDA between $161 million and $163 million for the full year [10] - For the fourth quarter of 2025, ODDITY expects net revenue between $149 million and $152 million, with a gross margin of approximately 69% [11]

Core Viewpoint - Oddity Tech Ltd. is identified as an oversold mid-cap stock with significant growth potential, despite a recent price target reduction by KeyBanc Capital Markets from $90 to $80, maintaining an Overweight rating [1][2]. Group 1: Company Overview - Oddity Tech Ltd. operates as an AI-driven beauty and wellness platform, known for brands like IL MAKIAGE and SpoiledChild, utilizing machine learning and proprietary data to personalize products in skincare, cosmetics, and wellness [4]. - The company went public in 2023 and has rapidly gained attention in the digital beauty market [4]. Group 2: Financial Performance and Projections - KeyBanc projects that Oddity can achieve revenue growth exceeding 20% and long-term EBITDA margins above 20%, indicating strong potential for both top-line and margin expansion [2]. - The recent adjustment in price target is attributed to broader market trends affecting mid-cap growth stocks rather than any decline in Oddity's fundamentals [3]. Group 3: Strategic Positioning - Oddity's vertically integrated direct-to-consumer (DTC) model, along with aggressive investments in research and development, positions the company uniquely within the beauty-tech sector [3].

Group 1 - Oddity Tech Ltd. is recognized as one of the best performing new tech stocks, with a recent price target adjustment by KeyBanc from $90 to $80 while maintaining an Overweight rating [1][3] - The company reported a net revenue of $241 million in Q2 2025, reflecting a 25% year-over-year increase from $193 million in Q2 2024, with a gross profit of $174 million and a gross margin of 72.3% [2] - Oddity Tech has raised its full-year financial outlook for 2025, projecting net revenue between $799 million and $804 million, indicating a 23% to 24% annual growth, driven by strong online revenue growth and international expansion [3] Group 2 - Oddity Tech operates as a consumer tech company focused on building digital-first brands in the beauty and wellness sectors, both in the US and internationally [4]

Performance Overview - Baron International Growth Fund gained 16.91% during Q2 2025, outperforming its benchmark MSCI ACWI ex USA Index, which appreciated 12.03% [3] - The Fund has exceeded both the Benchmark and Proxy Benchmark on a one-year trailing basis [3] Annualized Performance - For the 1-year period ended June 30, 2025, the Fund's Institutional Shares returned 19.72%, compared to 17.72% for the MSCI ACWI ex USA Index [4] - Over the last 3 years, the Fund's Institutional Shares returned 10.34%, while the Benchmark returned 13.99% [4] Market Catalysts - The U.S. trade/tariff policy pivot and strong momentum towards a pro-growth tax reduction and fiscal spending bill were key drivers of global capital markets [5] - Despite tariff deferrals, there remains a risk of retaliation and a weaker U.S. dollar, which could shift capital flows towards non-dollar assets [5] Sector Performance - The Energy sector, particularly investments in Waga Energy SA, was the largest contributor to the Fund's relative performance [6] - Strong stock selection in Consumer Staples and Industrials sectors also contributed positively, while Health Care sector allocation detracted from performance [6] Country Contributions - Overweight positioning in Korea, particularly in shipbuilding, significantly contributed to relative performance [7] - Positive stock selection in France, India, and Israel also bolstered results, while China showed modest adverse stock selection effects [7] Top Contributors - HD Korea Shipbuilding & Offshore Engineering Co., Ltd. contributed 1.66% to returns, driven by improving profit margins and backlog growth [8] - Waga Energy SA and ODDITY Tech Ltd. also made significant contributions, with returns of 1.48% and 1.01% respectively [9] Top Detractors - Alibaba Group Holding Limited detracted 0.26% from performance due to results that fell short of investor expectations amid geopolitical uncertainty [12] - Full Truck Alliance Co. Ltd. and Argenx SE also detracted from performance due to revised earnings guidance and sales below expectations, respectively [13][14] Recent Activity - New investments were made in Centum Electronics Limited and XP Inc., focusing on global security and fintech disruption themes [22][24] - Increased exposure to existing positions, including AMG Critical Materials N.V. and SK hynix Inc., while exiting several positions to concentrate on higher conviction investments [26] Outlook - The Fund anticipates continued relative outperformance of non-U.S. equities, driven by changing U.S. priorities and fiscal expansion in the EU [30] - The focus remains on sectors and companies positioned to benefit from geopolitical shifts and technological advancements, particularly in Korea and India [32]

Core Insights - ODDITY Tech Ltd. reported strong Q2 2025 results, with net sales and earnings exceeding estimates and showing year-over-year growth [1][3] - The company raised its full-year outlook, driven by robust top-line growth and strategic investments in innovation [2] Financial Performance - Adjusted EPS for Q2 was 92 cents, beating the estimate of 88 cents, and increased by 12.2% year-over-year [3] - Net sales reached $241.1 million, surpassing the estimate of $239 million, and grew by 25.1% from $192.8 million in the prior year [3] - Online DTC sales rose by 29.6% to $235.2 million, constituting 98% of total sales, up from 94% in the previous year [4] Margin and Cost Analysis - Gross profit was $174.4 million, a 25.3% increase from $139.1 million last year, with a gross margin of 72.3% [5] - SG&A expenses increased by 36.3% to $117.3 million, representing 48.6% of net sales, up 200 basis points year-over-year [5] - Operating income was $57.1 million, a 7.6% increase, while the operating margin declined to 23.7% [6] Strategic Developments - ODDITY's core brands, IL MAKIAGE and SpoiledChild, achieved double-digit online sales growth, supported by AI-driven personalization [10] - The company is on track to launch Brand 3 in Q4 2025, targeting the medical-grade dermatology segment, and Brand 4 is expected to launch in 2026 [11] - ODDITY raised $600 million through its first exchangeable note offering, indicating strong investor confidence [12] Future Guidance - For FY25, ODDITY expects net sales between $799 million and $804 million, reflecting 23-24% year-over-year growth [13] - Adjusted EBITDA is projected between $160 million and $162 million, with adjusted EPS expected between $2.06 and $2.09 [14] - For Q3 2025, net sales are anticipated to be between $144 million and $146 million, indicating year-over-year growth of 21-23% [14] Financial Health - As of June 30, 2025, ODDITY had cash and cash equivalents of $656.8 million, no long-term debt, and shareholders' equity of $351.2 million [9]

Core Insights - ODDITY Tech Ltd. reported strong financial results for Q2 2025, exceeding guidance across revenue, profit, and earnings per share, indicating robust business growth and profitability [2][4][6] - The company is expanding into new markets, particularly in healthcare with the upcoming launch of Brand 3, which focuses on medical-grade products [3][4] - ODDITY raised its full-year financial outlook for 2025, reflecting confidence in continued growth driven by a backlog of repeat orders [4][9] Financial Performance - Q2 2025 net revenue reached $241 million, a 25% increase year-over-year from $193 million in Q2 2024 [4][6] - Adjusted EBITDA for Q2 2025 was $70 million, up 12% from $62 million in Q2 2024, with an adjusted EBITDA margin of 28.8% [4][6] - Net income for Q2 2025 was $49 million, compared to $45 million in Q2 2024, with a net income margin of 20.4% [4][6] Financial Outlook - The updated full-year 2025 outlook includes net revenue between $799 million and $804 million, representing year-over-year growth of 23% to 24% [9][10] - For Q3 2025, ODDITY expects net revenue between $144 million and $146 million, with a gross margin of approximately 68% [11][9] - Adjusted diluted EPS for the full year is projected to be between $2.06 and $2.09, an increase from the previous outlook [9][10] Strategic Initiatives - The company is progressing towards the formal launch of Brand 3 in Q4 2025 and Brand 4 in 2026, indicating a focus on innovation and market expansion [5][4] - ODDITY is also developing its ODDITY LABS molecule discovery platform, which may enhance its product offerings in the future [5][4] - The company completed its first exchangeable note offering, upsized to $600 million, strengthening its cash position [5][4]