LRLCF - e.l.f. Beauty: Let Your Winners Run

2024-05-11 10:00:00 ET

Summary

• e.l.f. Beauty investors experienced a stunning bear market decline in April.
• ELF investors were concerned about Ulta Beauty's negative commentary on Gen Z consumers.
• ELF's growth thesis remains intact, although a deceleration cannot be ruled out.
• e.l.f. Beauty investors must watch its international expansion plans and skincare penetration closely.
• ELF stock seems to have bottomed out in late April. I explain why investors should let their profits run further. Read on.

ELF Stock Suffered A Bear Market

e.l.f. Beauty, Inc. ( ELF ) investors suffered a steep bear market decline between March and April 2024, as beauty investors bailed following Ulta Beauty's (ULTA) negative commentary in early April. Accordingly, Ulta warned of potentially "slowing growth" attributed to "rising credit card debt and student loan repayments among consumers." Consequently, it intensified selling pressure on ELF, given its focus on debt-laden Gen Z and value-conscious consumers. The selloff is justified, as ELF stock is rated with an expensive, high-growth premium ("F" valuation grade) as the market possibly assessed heightened execution risks....

For further details see: