12 Best Small Cap Pharma Stocks to Buy Now

2. Evolus, Inc. (NASDAQ:EOLS)

Number of Hedge Fund Holders: 32

Evolus, Inc. (NASDAQ:EOLS) is a performance beauty company specializing in the cash-pay aesthetic market, focusing on neurotoxins and dermal fillers. Its flagship product, Jeuveau, is a botulinum toxin type A used to temporarily improve moderate to severe frown lines between the eyebrows in adults.

Evolus, Inc. (NASDAQ:EOLS) reported strong revenue growth for Q3 2024, reaching $61.1 million, a 22% increase compared to the same period in 2023. This growth outpaced the overall market and was driven by effective marketing strategies, the Evolus Rewards program, and increased brand recognition. The company maintained a healthy gross margin of 68.9%, reflecting efficient cost management.

However, Evolus, Inc. (NASDAQ:EOLS) faced challenges with high operating expenses, which totaled $76.6 million. A large portion of these costs came from selling, general, and administrative (SG&A) expenses, including stock-based compensation. As a result, the company reported a non-GAAP operating loss of $6.7 million, a significant drop from the $1.1 million operating income in the previous quarter. This highlights the need to manage expenses as revenue continues to grow.

Evolus, Inc. (NASDAQ:EOLS) ended the quarter with $85 million in cash, a decrease from $93.7 million in June, and a cash burn of $8.7 million. The company revised its 2024 revenue guidance to $260 million to $266 million, forecasting 29% to 32% growth. They also expect a strong gross profit margin of 68% to 71% and non-GAAP operating expenses between $185 million and $190 million. Looking ahead, the company plans to launch Evolysse in the U.S. by September 2025, which is expected to attract interest due to its unique cold HA technology.