ELF

e.l.f. Beauty Inc

Consumer


Presented:05/31/2024
Price:$186.91
Cap:$10.46B
Current Price:$109.94
Cap:$6.20B

Presented

Date05/31/2024
Price$186.91
Market Cap$10.46B
Ent Value$11.65B
P/E Ratio84.29x
Book Value$11.56
Div Yield0%
Shares O/S55.94M
Ave Daily Vol1,612,811
Short Int11.13%

Current

Price$109.94
Market Cap$6.20B
e.l.f. Beauty, Inc. is a holding company, which engages in the provision of inclusive, accessible, clean, vegan and cruelty free cosmetics and skin care products. The company focuses on the e-commerce, national retailers and international business channels. Its brands include elf, elf skin, WELL People and KEYS soulcare. The company was founded in 2004 and is headquartered in Oakland, CA.

Publicly traded companies mentioned herein: Coty Inc (COTY), Elf Beauty Inc (ELF), L’Oreal SA (OR FP), Walmart Inc (WMT)

Highlights

The presenter is short shares of Elf Beauty Inc (ELF), which he describes as a fast fashion concept within cosmetics. ELF uses cheaper Chinese suppliers to copy prestige brands, and the company has gained significant market share (12.8% in color cosmetics as of the most recent quarter) from its lower price points and effective social media marketing. The stock has skyrocketed over the past few years due to strong execution of this strategy, but the presenter expects the EPS growth trajectory to slow meaningfully based on increased competition, category weakness, and slower distribution gains. Based on this outlook, there could be material downside to the current 50x valuation on consensus FY2025 (ends March 2025) EPS. 

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Idea Discussion

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