e.l.f. beauty Analysis – February 2025

e.l.f. Beauty, Inc. (NYSE: ELF) together with its subsidiaries, provides cosmetic and skin care products. ELF is down 28% over the last five days, due to a weaker guidance for FY2025. It is also down 56% from a year ago. Weaker performance among the beauty/makeup sector has contributed to the beating. Yet ELF maintains a very good outlook and is trading at a attractive price (near a 52-week low). It continues to outperform the sector and at the same time increasing its market share.

Guidance FY2025:
Net sales growth outlook: +27-28%
Gross margin outlook: 71%
Adjusted EBITDA outlook: +23-25%

Stats (most recent quarter):
Market cap: $4b
Forward P/E ratio: 16x
Return on equity: 17%
Sales: $1.22b
Net Income: $107m
Total cash: $96m
Total debt: $301m

Geographic sales: “The United States accounted for 85% of our net sales in the fiscal year ended March 31, 2024. The remaining 15% was attributable to international markets.”

Retail and online sales: “…national and international retailers comprised 84% of our net sales. The remaining 16% came from e-commerce channels.”

Customers: “Our largest three customers, Target, Walmart and Ulta Beauty, accounted for 25%, 17% and 16%, respectively, of our net sales in the fiscal year ended March 31, 2024.”

Tarrifs: “E.l.f. Beauty relies heavily on China for manufacturing and was “relieved” to learn new duties from President Donald Trump were only 10%” ELF’s problems may get worse if Trump increases tarrifs on China.

*I own and recommend shares of ELF*