Investing.com - Revlon shares plunged Tuesday on data showing the cosmetic company was struggling to sell products.
In the four weeks ended Feb. 23, sales fell 15%, adding to the 9% decline over the last 12 months, Jefferies analyst Stephanie Wissink said, citing Nielsen data.
Shares of Revlon (NYSE:REV) fell nearly 20% and are now down more than 15% on the year. However, sharp moves on material updates are not uncommon as the stock is illiquid, with only about 5% to 10% in the public float.
The update comes just months after the company's third-quarter results beat estimates from Investing.com. But the results did flag a decline in sales of the Revlon brand, which makes up about half of total revenues, owing to lower net sales of Revlon color cosmetics.
The company also launched an optimization program to streamline operations and cut annual costs cost by about $125 million to $150 million.
Following the downturn, rumors swirled that longtime and majority Revlon shareholder Ron Perelman may be tempted to scoop up additional shares with a view to taking Revlon private.
But some said this was unlikely, as Perelman has previously expressed support for the company's turnaround program and pledged to cap his stake in the company at 90%. He owns about 80% of Revlon.
The weakness in Revlon sparked a downturn in other rivals as ELF Beauty (NYSE:ELF) and Coty (NYSE:COTY) turned negative.
Revlon is expected to release its fourth-quarter report on March 21.