e.l.f. Beauty, Inc. (ELF) | Investment Case

1. Company Snapshot

1.a. Company Description

e.l.f. Beauty, Inc., together with its subsidiaries, provides cosmetic and skin care products under the e.l.f. Cosmetics, e.l.f. Skin, Well People, and Keys Soulcare brand names worldwide.The company offers eye, lip, face, face, paw, and skin care products.It sells its products through national and international retailers and direct-to-consumer channels, which include e-commerce platforms in the United States, and internationally primarily through distributors.

The company was formerly known as J.A. Cosmetics Holdings, Inc.and changed its name to e.l.f. Beauty, Inc.in April 2016.

e.l.f. Beauty, Inc.was founded in 2004 and is headquartered in Oakland, California.

Show Full description

1.b. Last Insights on ELF

Breaking News: e.l.f. Beauty, Inc. ELF presents at Morgan Stanley Global Consumer Retail Conference 2025. No recent earnings release mentioned. e.l.f. Beauty reports strong growth. Analysts recommend buy with price target at 224. Cantor Fitzgerald analyst gives a buy recommendation. Oppenheimer analyst rates the stock as outperform. e.l.f. Beauty focuses on affordable luxury beauty products. The company expands distribution channels. e.l.f. Beauty targets Gen Z consumers. Several firms rate the stock as hold or neutral. Wedbush analyst maintains a neutral stance.

1.c. Company Highlights

Last Price	81.4
Change Percentage	-0.27%
Open	81.73
Previous Close	81.62
Market Cap ( Millions)	4624
Volume	2587226
Year High	150.99
Year Low	49.4
M A 50	108.21
M A 200	99.77

FCF Yield	2.92%
Dividend Yield	0.00%
ROE	13.05%
Debt / Equity	39.11%
Net Debt / EBIDTA	76.08%
Price To Book	5.9
Price Earnings Ratio	47.57
Price To FCF	34.26
Price To sales	3.34
EV / EBITDA	25.06

2. Driven by Pricing and Rhode, Despite Shipments Lag

The company's Q2 financial performance was marked by a 3% decline in organic net sales, excluding Rhode, primarily due to the decision to temporarily halt shipments to retailers who were slow to implement the price increase effective August 1. However, consumption outpaced category trends by over 3x, resulting in 140 basis points of market share gains. The actual EPS came out at $0.68, beating estimates of $0.57. Revenue growth was driven by pricing and product mix, which added approximately 21 points to net sales growth, partially offset by a 6 percentage point impact from lower unit volumes. As per Mandy Fields, "our consumption outpaced category trends by over 3x, leading to 140 basis points of market share gains in the quarter."

Publication Date: Nov -10

                                    📋 Highlights
                                    Shipments Below Consumption::
                                                Q2 shipments were 3% below consumption due to halted orders for non-compliant price increases, leading to 3% organic net sales decline (excluding Rhode).
Strong Market Share Gains::
                                                Consumption outpaced category trends by 3x, driving 140 bps of market share growth in Q2 despite shipment challenges.
Full-Year Guidance::
                                                Net sales growth of 18–20% YoY (3–4% organic, excluding Rhode), with H2 net sales growth expected at 24–27% (2–5% organic growth).
EBITDA Margin Pressure::
                                                Adjusted EBITDA guidance of $302M–$306M (+2–3% YoY), with H2 margins at ~17% due to 600 bps higher marketing spend and lower gross margins.
Gross Margin Recovery::
                                                Gross margin expected to improve to 71% in H2 (+200 bps sequentially), partially offsetting EBITDA margin declines from increased marketing investment.

                                

Guidance and Outlook

For the full year, the company expects net sales growth of 18% to 20% year-over-year, with organic net sales, excluding Rhode, expected to be up approximately 3% to 4% year-over-year. In the second half, net sales growth is expected to be 24% to 27% year-over-year, with Rhode contributing 22 percentage points to net sales growth. Adjusted EBITDA is expected to be $302 million to $306 million for the full year, up 2% to 3% year-over-year, implying adjusted EBITDA margins of approximately 17% in the second half.

Valuation Metrics

Analysts estimate next year's revenue growth at 19.9%. With a P/E Ratio of 41.93 and an EV/EBITDA of 25.95, the stock appears to be priced for high growth expectations. The ROE of 13.05% and ROIC of 10.08% indicate a decent return on equity and invested capital, respectively. The Net Debt / EBITDA ratio of 0.87 suggests a manageable debt burden.

Margin Expansion and Rhode's Impact

The company expects gross margin to improve in the second half, with a target of 71%, up 200 basis points sequentially relative to the first half. Rhode is expected to be accretive to EBITDA margins, despite investments behind the brand. As Tarang Amin stated, "we expect Rhode to be accretive to our EBITDA margins, but we're investing behind the brand."

3. NewsRoom

e.l.f. Beauty, Inc. (ELF) Presents at Morgan Stanley Global Consumer & Retail Conference 2025 Transcript

Dec -03

Source: seekingalpha.com

ELF's Gross Margin Falls 165 bps: Are Tariffs the Main Drag Now?

Dec -02

Source: zacks.com

Cetera Investment Advisers Has $2.67 Million Holdings in e.l.f. Beauty $ELF

Nov -29

Source: defenseworld.net

e.l.f. Beauty $ELF Shares Sold by Boston Partners

Nov -29

Source: defenseworld.net

Coldstream Capital Management Inc. Acquires 1,522 Shares of e.l.f. Beauty $ELF

Nov -28

Source: defenseworld.net

What Has E.l.f. (ELF) Stock Done For Investors?

Nov -26

Source: fool.com

Creative Planning Lowers Stock Position in e.l.f. Beauty $ELF

Nov -26

Source: defenseworld.net

3 Mid-Cap Growth Stocks That Have Mammoth Long-Term Potential

Nov -21

Source: fool.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.90%)

6. Segments

Cosmetics and Skin Care Products

Expected Growth: 8.9%

e.l.f. Beauty, Inc.'s 8.9% growth in cosmetics and skin care products is driven by increasing demand for affordable, cruelty-free, and vegan products, particularly among Gen Z and millennials. Strong e-commerce presence, influencer partnerships, and innovative product launches also contribute to the growth.

7. Detailed Products

e.l.f. Cosmetics

A wide range of affordable and cruelty-free cosmetics, including eyeshadows, lipsticks, foundations, and more.

W3LL PEOPLE

A premium, natural, and organic skincare and makeup line that promotes healthy, glowing skin.

BareMinerals

A popular mineral-based cosmetics brand offering a variety of products, including foundation, eyeshadow, and skincare.

Physicians Formula

A dermatologist-recommended brand offering a range of skincare and makeup products, including mineral-based and organic options.

8. e.l.f. Beauty, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

e.l.f. Beauty, Inc. faces moderate threat from substitutes due to the presence of established brands in the beauty and personal care industry. However, the company's focus on affordable and cruelty-free products helps to differentiate it from competitors.

Bargaining Power Of Customers

e.l.f. Beauty, Inc. has a large customer base, but individual customers do not have significant bargaining power due to the company's wide distribution network and affordable pricing strategy.

Bargaining Power Of Suppliers

e.l.f. Beauty, Inc. relies on a diverse supplier base, which reduces the bargaining power of individual suppliers. However, the company may face some pressure from suppliers of critical ingredients or components.

Threat Of New Entrants

The beauty and personal care industry is highly competitive, and new entrants can easily enter the market with innovative products or business models. e.l.f. Beauty, Inc. needs to continuously innovate and adapt to changing consumer preferences to stay competitive.

Intensity Of Rivalry

The beauty and personal care industry is highly competitive, with many established brands and new entrants vying for market share. e.l.f. Beauty, Inc. faces intense rivalry from competitors, which can lead to pricing pressure and advertising wars.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	15.89%
Debt Cost	3.95%
Equity Weight	84.11%
Equity Cost	11.93%
WACC	10.66%
Leverage	18.89%

11. Quality Control: e.l.f. Beauty, Inc. passed 6 out of 9 key points

Strong Liquidity

Low Debt

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Inter Parfums

A-Score: 5.9/10

Value: 4.9

Growth: 8.1

Quality: 8.1

Yield: 5.0

Momentum: 2.5

Volatility: 7.0

1-Year Total Return ->

Clorox

A-Score: 5.3/10

Value: 4.0

Growth: 3.9

Quality: 6.5

Yield: 7.0

Momentum: 1.0

Volatility: 9.7

1-Year Total Return ->

e.l.f. Beauty

A-Score: 4.4/10

Value: 0.8

Growth: 9.6

Quality: 7.1

Yield: 0.0

Momentum: 7.0

Volatility: 2.0

1-Year Total Return ->

Newell Brands

A-Score: 3.9/10

Value: 7.8

Growth: 1.4

Quality: 1.9

Yield: 9.0

Momentum: 1.0

Volatility: 2.0

1-Year Total Return ->

Helen of Troy

A-Score: 3.0/10

Value: 9.5

Growth: 3.0

Quality: 3.1

Yield: 0.0

Momentum: 0.0

Volatility: 2.3

1-Year Total Return ->

Coty

A-Score: 2.8/10

Value: 6.4

Growth: 3.1

Quality: 2.8

Yield: 0.0

Momentum: 0.5

Volatility: 4.0

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

18.18%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

10.66%

e.l.f. Beauty, Inc. - US26856L1035

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on ELF

1.c. Company Highlights

Expensive

Better Quality

Strong Momentum

Earnings Beats

Revenues Beats

Higher Growth

More Volatile

Earnings Miss

Average Yield

Weak Momentum

Revenues Miss

2. Driven by Pricing and Rhode, Despite Shipments Lag

Guidance and Outlook

Valuation Metrics

Margin Expansion and Rhode's Impact

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.90%)

6. Segments

Cosmetics and Skin Care Products

Expected Growth: 8.9%

7. Detailed Products

e.l.f. Cosmetics

W3LL PEOPLE

BareMinerals

Physicians Formula

8. e.l.f. Beauty, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: e.l.f. Beauty, Inc. passed 6 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

81.4$

Current Price

81.4$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA