Shares of prestige hair care company Olaplex (NASDAQ: OLPX) have risen 16% this week as of 12:30 p.m. ET on Friday, according to data provided by S&P Global Market Intelligence. Since reporting respectable earnings on Aug. 6, the company's shares have spiked 32%.

The primary catalyst for the company's run-up in share price this week seems to be tied to an announcement on Wednesday that executive chairman John Bilbrey bought nearly $400,000 worth of Olaplex stock. While insider purchases are relatively common for most stocks, these were the first open-market buys of Olaplex stock by an insider in over a year, which has the market optimistic about the company's turnaround prospects.

After going public with a share price above $20 in 2021, Olaplex's current share price of roughly $2.40 more closely resembles that of a penny stock than a potential value investment at first glance. In 2023 alone, sales declined a staggering 35%, with much of this drop coming from its retail customers accumulating too much inventory (and subsequently delaying new purchases) as sales had boomed in the post-pandemic landscape.

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Source Fool.com