How Do We Expect Revlon’s Hair Color Division To Trend?

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Revlon’s hair color division contributes to around 27% of its revenues and around 21% of our stock price valuation for the company. Prior to the acquisition of The Colomer Group (TCG) in 2013, Revlon did not have a salon specific product, hence it lost unit volumes to salon brands. Revenue contribution from this category increased from around 17% in 2013 to 28% in 2014 post the TCG acquisition. Given that TCG generates a majority of its revenues from hair care products, the acquisition should boost hair care revenues for Revlon. We expect Revlon’s hair color division’s revenues to increase by a CAGR of ~3% over the next 5 years.

rev hairtrend

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Notes:

1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for Revlon