This AI Stock Picks The Perfect Lipstick : here is why

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This AI Stock Picks The Perfect Lipstick : here is why

investing ideas :: 2024-12-02 :: source - ibd

By SCOTT LEHTONEN

IPO Stock Of The Week and artificial intelligence leader Oddity (ODD) is attempting to break out past a new buy point. The AI stock is one of the best stocks to watch on Investor's Business Daily's IPO Leaders screen.

The Israel-based beauty and wellness company debuted on the Nasdaq on July 19. It soared nearly 36% on its first day of trading, closing at 47.53 after selling for $35 in the initial public offering.

Oddity uses algorithms and machine-learning models to deliver a precise product match to customers. It operates the direct-to-consumer beauty brand Il Makiage and SpoiledChild, a wellness brand.

On Nov. 6, Oddity reported adjusted earnings of 32 cents a share on sales of $119 million for the September-ended quarter. Profits jumped 52% vs. the year-ago period, while revenue grew 26%, according to IBD MarketSurge.

"The beauty industry is transforming and Oddity is leading this transformation," said Chief Executive Officer Oran Holtzman in the press release.

"The strength and resilience of our direct-to-consumer model is on full display in this market backdrop, where some of our competitors are experiencing slowing sales, weaker foot traffic and excess inventory conditions," Holtzman added. "In contrast, we are consistently delivering strong, profitable growth across brands, products and categories in every environment."

For the full year, Wall Street expects the company's earnings to grow by 37% before falling 8% in 2025, per IBD MarketSurge.

AI Stock Hits New Buy Point

On Nov. 25, the AI stock cleared a 47.08 handle entry on a consolidation that started in December 2023, about five months after the new issue began trading. But shares closed below that entry Friday. If the stock retakes that buy point, the 5% buy range will top out at 49.43.

A potential flaw is the stock's lagging relative strength line. Despite recent gains, it still sits sharply off its 52-week high; however, it is at its highest level since June.

The IBD Stock Checkup shows that Oddity stock has a 93 out of 99 IBD Composite Rating. That makes the AI stock a top idea to watch right now.

Be sure to follow Scott Lehtonen on X at @IBD_SLehtonen for more on the Dow Jones Industrial Average and the stock market today.