Key Stats for ELF Stock
- Past week’s performance: -15%
- 52-week range: $49 to $151
- Valuation model target price: $107
- Implied upside: 74.5% over 2.0 years
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What Happened?
e.l.f. Beauty (ELF) stock fell 15.1% this week, and the move came during a rough stretch for beauty stocks more broadly. On March 24, Reuters reported that Estée Lauder was in talks with Puig on a potential merger, which kept investor attention on a changing beauty landscape. e.l.f. also presented at Shoptalk that day, but the company did not announce a new financial update there.
The sharper pressure likely came from sector read-throughs rather than a new company-specific miss. On March 13, Reuters reported that Ulta Beauty slumped after warning that rising costs were hitting margins, which pushed investors to revisit profit risk across the beauty space. For ELF, that matters because the stock still trades as a growth name, so sentiment can swing quickly when peers highlight cost pressure.
Tariff headlines also stayed in the background. Reuters reported in February that e.l.f. was one of the stocks to watch as tariff uncertainty returned, and the same month, Reuters also reported that retail stocks rose after the U.S. Supreme Court struck down Trump’s global tariffs. That does not change e.l.f.’s brand momentum, but it helps explain why the stock reacts to macro headlines around imported goods and consumer pricing.
Importantly, the company’s last major fundamental update was positive. Reuters reported on February 4 that e.l.f. beat third-quarter sales estimates, raised its fiscal 2026 net sales outlook, and said demand for its affordable products remained strong. So this week’s drop looks more like a reset in expectations than a reaction to deteriorating business results.
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Is ELF Stock Undervalued?
Under valuation model assumptions realized through 12/31/28, the stock is modeled using:
- Revenue growth (CAGR): 20%
- Operating Margins: 18.6%
- Exit P/E Multiple: 18.6x
Based on these inputs, the model estimates a target price of $106.56, implying 74.5% total upside from the current share price and a 31.9% annualized return over the next 2.0 years.
Those assumptions start with a business that is still growing faster than most consumer brands. Revenue rose 28.3% to $1.31 billion in fiscal 2025, and LTM revenue reached $1.52 billion. Gross margin also stayed strong at 70.3% in the LTM period, which shows the brand still has pricing power and favorable product economics.
Profitability is solid, but it is no longer expanding as fast as revenue. Operating margin was 15.0% in fiscal 2025 and 11.5% on an LTM basis, while LTM EBIT margin in the terminal view was also 11.5%. That gap helps explain why the market is asking harder questions about how much margin can rebound from here.
The balance sheet also matters to the valuation debate. The company ended the LTM period with about $197 million of cash, but net debt rose to $729.3 million after debt increased and goodwill and intangible assets moved higher. That means investors are not just paying for organic growth, but also for management to turn acquisitions and brand expansion into durable earnings growth.
At current levels, the stock looks cheaper than it did near prior highs, but it is not being valued like a no-growth retailer. The Street target price mean is $111.71, while the terminal view shows 18.56x NTM P/E and 12.24x NTM EV/EBITDA. So the valuation case depends on e.l.f. sustaining strong sales growth while rebuilding margins toward the model’s 18.6% assumption.
What’s Driving the ELF Stock Going Forward?
The next major catalyst is earnings. e.l.f. Beauty is expected to report fiscal Q4 2026 results on May 22, and investors will want to see whether the company can hold onto the momentum it showed in February. Last quarter, management raised full-year net sales guidance to $1.60 billion to $1.61 billion and adjusted EBITDA guidance to $323 million to $326 million.
Management’s commentary still points to strong brand execution. In its Q3 release, Chairman and CEO Tarang Amin said, “We continue to gain market share across cosmetics and skincare and are pleased with the broad-based strength across our portfolio.” That matters because e.l.f.’s growth story depends on repeat share gains, not just a favorable beauty cycle.
Leadership and insider signals will also stay in focus. The company appointed former Church & Dwight CEO Matthew Farrell to the board in February, and Reuters later reported that Farrell bought common shares on February 20. That does not remove near-term volatility, but it is a factual sign that a new board member committed personal capital after joining.
Sector conditions will matter as much as company execution. Ulta’s March margin warning, ongoing tariff headlines, and shifting competitive moves across beauty all show that investors are balancing demand resilience against cost risk. So the next move in e.l.f. stock will likely depend on whether the company can prove that strong sales, high gross margins, and cash flow growth can outweigh sector-wide caution.
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Should You Invest in e.l.f. Beauty?
The only way to really know is to look at the numbers yourself. TIKR gives you free access to the same institutional-quality financial data that professional analysts use to answer exactly that question.
Pull up ELF, and you’ll see years of historical financials, what Wall Street analysts expect for revenue and earnings in the quarters ahead, how valuation multiples have moved over time, and whether price targets are trending up or down.
You can build a free watchlist to track ELF alongside every other stock on your radar. No credit card required. Just the data you need to decide for yourself.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
