What's Next for e.l.f. Beauty Stock After a 25% Drop in 3 Months?

Zacks11-20

e.l.f. Beauty, Inc. ELF has experienced notable volatility in its stock performance. Over the past three months, the stock has declined 24.7%, underperforming the Zacks Consumer Staples sector’s drop ...

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Over the past three months, the stock has declined 24.7%, underperforming the Zacks Consumer Staples sector’s drop ...</p>\n\n<a href=\"https://finance.yahoo.com/news/whats-next-e-l-f-154500723.html\">Source Link</a>\n\n</div>\n","source":"yahoofinance","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>What's Next for e.l.f. Beauty Stock After a 25% Drop in 3 Months?</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nWhat's Next for e.l.f. Beauty Stock After a 25% Drop in 3 Months?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-11-20 23:45 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://finance.yahoo.com/news/whats-next-e-l-f-154500723.html><strong>Zacks</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>e.l.f. Beauty, Inc. ELF has experienced notable volatility in its stock performance. Over the past three months, the stock has declined 24.7%, underperforming the Zacks Consumer Staples sector’s drop ...</p>\n\n<a href=\"https://finance.yahoo.com/news/whats-next-e-l-f-154500723.html\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"LU0690374615.EUR","symbol_name":"FUNDSMITH EQUITY \"R\" (EUR) ACC","start_time":0,"source_url":"https://finance.yahoo.com/news/whats-next-e-l-f-154500723.html","article_id":"2485140165","we_media_id":null,"thumbnails":["https://s.yimg.com/uu/api/res/1.2/gs_.4cu2NstdENlVVLE27A--~B/aD00NjU7dz02MjA7YXBwaWQ9eXRhY2h5b24-/https://media.zenfs.com/en/zacks.com/c781a5c027951ec951542da0e5ce3cc4"],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2485140165","pubTimestamp":1732117500,"columns":[],"sourceInfo":{"source_id":"yahoofinance","name":"雅虎金融"},"weMediaInfo":null,"summary":"e.l.f. Beauty, Inc. ELF has experienced notable volatility in its stock performance. Over the past three months, the stock has declined 24.7%, underperforming the Zacks Consumer Staples sector’s drop of 4.5% and the S&P 500's growth of 5%. This downward trend reflects a combination of market-wide headwinds and company-specific challenges, raising questions about its near-term outlook.ELF Three-Month Price Performance vs. Sector & S&P 500. However, the stock has rebounded recently, jumping 8% in the past month, buoyed by the company’s second-quarter fiscal 2025 results released on Nov. 6. This underscores the dual narrative surrounding e.l.f. Beauty, while the company’s strategic growth initiatives and market leadership position offer significant long-term potential, the near-term challenges demand a close watch.","collect":0,"end_time":0,"defaultTopTitle":"yahoo.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"LU0690374615.EUR":"FUNDSMITH EQUITY \"R\" (EUR) ACC","LU2552382058.USD":"WELLINGTON US BRAND POWER \"A\" (USD) ACC","BK4597":"股息贵族","LU1244550494.USD":"FRANKLIN GLOBAL MULTI-ASSET INCOME \"A\" (USDHEDGED) ACC","LU1585245621.USD":"EASTSPRING INV GLOBAL LOW VOLATILITY EQUITY FUND \"A\" (USD) ACC B","LU2552382132.HKD":"WELLINGTON US BRAND POWER \"A\" (HKD) ACC","BK4532":"文艺复兴科技持仓","BK4585":"ETF&股票定投概念","BK4533":"AQR资本管理(全球第二大对冲基金)","LU0823411888.USD":"法巴消费创新基金 Cap","LU2237443382.USD":"Aberdeen Standard SICAV I - Global Dynamic Dividend A MIncA USD","LU0052756011.USD":"TEMPLETON GLOBAL BALANCED \"A\" (USD) INC","BK4558":"双十一","LU2237443549.SGD":"Aberdeen Standard SICAV I - Global Dynamic Dividend A MIncA SGD-H","BK4114":"综合货品商店","LU0566484027.USD":"安本美国小盘成长股","LU1559883803.SGD":"Aberdeen Standard SICAV I - North American Smaller Companies Fund A Acc SGD-H","LU1242518857.USD":"FULLERTON LUX FUNDS - ASIA ABSOLUTE ALPHA \"I\" (USD) ACC","LU2237443622.USD":"Aberdeen Standard SICAV I - Global Dynamic Dividend A Acc USD","LU1267930227.SGD":"TEMPLETON GLOBAL BALANCED \"AS\" (SGD) ACC A","LU2552382215.SGD":"WELLINGTON US BRAND POWER \"A\" (SGDHDG) ACC","LU2237443978.SGD":"Aberdeen Standard SICAV I - Global Dynamic Dividend A Acc SGD-H","BK4588":"碎股","LU0128525689.USD":"TEMPLETON GLOBAL BALANCED \"A\"(USD) ACC","LU0310799852.SGD":"FTIF - Templeton Global Equity Income A MDIS SGD","LU0690374961.EUR":"FUNDSMITH EQUITY \"R\" (EUR) INC","LU1989763690.USD":"东方汇理世代食品基金A2 Acc","LU1244550577.SGD":"FTIF - Franklin Global Multi-Asset Income A (Mdis) SGD-H1","TGT":"塔吉特","ELF":"e.l.f. 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Beauty, Inc. ELF has experienced notable volatility in its stock performance. Over the past three months, the stock has declined 24.7%, underperforming the Zacks Consumer Staples sector’s drop of 4.5% and the S&P 500's growth of 5%. This downward trend reflects a combination of market-wide headwinds and company-specific challenges, raising questions about its near-term outlook.\nELF Three-Month Price Performance vs. Sector & S&P 500\nImage Source: Zacks Investment Research\nHowever, the stock has rebounded recently, jumping 8% in the past month, buoyed by the company’s second-quarter fiscal 2025 results released on Nov. 6. This underscores the dual narrative surrounding e.l.f. Beauty, while the company’s strategic growth initiatives and market leadership position offer significant long-term potential, the near-term challenges demand a close watch.\nELF One-Month Price Performance vs. Sector & S&P 500\nImage Source: Zacks Investment Research\nChallenges Hindering e.l.f. Beauty’s Momentum\nThe beauty and cosmetics industry has been navigating a complex macroeconomic environment marked by shifting consumer behaviors and heightened economic pressures. Inflation, cautious discretionary spending and evolving preferences have created headwinds for many companies in the sector. These challenges are particularly pronounced in the U.S. market, where a contraction in core categories like color cosmetics signals broader demand volatility.The broader U.S. color cosmetics market contracted by 5% in the second quarter of fiscal 2025, a sharper decline compared to the 1% contraction in the preceding quarter. This reflects increasing consumer caution amid economic pressures, particularly in discretionary categories. While e.l.f. Beauty managed to achieve 16% growth in U.S. tracked channels, it fell short of management’s 20% expectation, signaling vulnerability to broader market trends.e.l.f. Beauty faces intensifying competition from legacy players such as The Estee Lauder Companies EL, and emerging indie brands, each vying for consumer attention in the highly fragmented beauty space. Legacy brands benefit from extensive distribution networks and deep marketing budgets, while indie brands often leverage niche positioning and viral digital campaigns to capture market share. The rise of clean beauty and premiumization trends has encouraged consumers to explore alternatives, adding pressure on e.l.f. Beauty to continuously innovate and differentiate.In the pursuit of growth, companies like e.l.f. Beauty are increasingly investing in marketing, talent and strategic acquisitions to bolster their competitive positioning. However, these growth-oriented expenditures come at a cost, particularly in a challenging macroeconomic environment. e.l.f. Beauty’s SG&A expenses surged to 53% of net sales in the second quarter compared with 45% in the year-ago period, driven by increased marketing spending, team expansion and Naturium integration costs. Rising operational expenses can weigh heavily on profitability, especially when paired with slowing sales growth in key markets.Balancing the need to invest in growth while protecting profit margins remains a key challenge for e.l.f. Beauty as it adapts to a changing and competitive industry.\nIs ELF Stock Still Overpriced?\ne.l.f. Beauty's valuation remains a matter of debate. Despite the pullback in the stock price, ELF is trading at a premium relative to industry peers, which seems difficult to justify given the present concerns. The company is currently trading at a forward 12-month P/E of 37.24, much higher than the industry’s 24.13 and the sector’s 17.27. e.l.f. Beauty's Value Score of F further reinforces these concerns.\nImage Source: Zacks Investment Research\nGrowth Drivers Supporting e.l.f. Beauty’s Outlook\ne.l.f. Beauty's growth trajectory is fueled by a combination of strong financial performance, consistent market share gains, and a relentless focus on innovation. The company delivered remarkable second-quarter fiscal 2025 net sales growth of 40% year over year, attributed to international growth, digital channels and increased domestic distribution.\ne.l.f. Beauty has achieved 23 consecutive quarters of market share gains, distinguishing itself as a leader in the cosmetics industry. In the second quarter, the company added 195 basis points (bps) of U.S. market share, building on the 330 bps gained in the year-ago period. This sustained outperformance demonstrates the strength of its value proposition, innovative product portfolio and marketing effectiveness.e.l.f. Beauty’s powerhouse innovation strategy is a cornerstone of its growth. Its innovation pipeline focuses on leveraging consumer insights and trends to develop high-quality products with competitive pricing, continuously refreshing its portfolio with products that maintain customer interest and drive category growth and enhancing core franchises such as Power Grip Primer and Halo Glow, which remain industry-leading performers.e.l.f. Beauty has been strategically expanding its retail presence to increase brand visibility and accessibility, ensuring its products reach a broader consumer base. The company has made significant strides in securing expanded shelf space with key retail partners, such as Target TGT and Dollar General DG. This enhanced presence at high-traffic retailers not only boosts e.l.f. Beauty’s visibility in both urban and underserved rural markets but also reinforces its mission to make premium beauty products more accessible.Capitalizing on the surge in online shopping, e.l.f. Beauty has made significant investments to strengthen its digital and e-commerce platforms. In the second quarter, digital consumption grew 40% year over year, with digital channels representing 20% of total sales, up from 17% last year.\nThis growth is driven by the success of e.l.f. Beauty's Beauty Squad Loyalty Program, which has expanded to 5.3 million members, growing 30% annually. Initiatives like early access to product launches and deeper digital partnerships are accelerating e.l.f. Beauty's e-commerce performance. These upsides position the company for continued success in the competitive cosmetics industry. On its second-quarter earnings call, management raised its fiscal 2025 net sales growth guidance to 28-30%, up from 25-27% expected before, and its adjusted EBITDA outlook to $304-$308 million from the earlier view of $297-$301 million. This reflects management’s confidence in its ability to sustain strong performance across its diversified portfolio.\nNavigating ELF Stock: A Guide for Investors\ne.l.f. Beauty has faced stock volatility, with recent declines overshadowing its strong growth potential. The company has demonstrated impressive market share gains, consistent innovation and significant expansion in digital and international markets.\nHowever, rising operational expenses and competition from both legacy and emerging brands pose hurdles. While concerns about its high valuation persist, the company’s growth trajectory and strategic investments support a cautiously optimistic outlook.\nFor now, maintaining positions in e.l.f. Beauty appears prudent. The company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.\nWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report\nTarget Corporation (TGT) : Free Stock Analysis Report\nDollar General Corporation (DG) : Free Stock Analysis Report\nThe Estee Lauder Companies Inc. (EL) : Free Stock Analysis Report\ne.l.f. Beauty (ELF) : Free Stock Analysis Report\nTo read this article on Zacks.com click here.\nZacks Investment Research","kind":"highlight","is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"0","news_tag":"","news_rank":0,"symbols":[],"gpt_button":0},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.4","shortVersion":"4.29.4","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2485140165"}