Heron Therapeutics enters supply agreement with Patheon and Thermo Fisher
On Thursday, Canaccord Genuity maintained a positive outlook on e.l.f. Beauty (NYSE:ELF) by raising its price target from $105.00 to $114.00 and reaffirming a Buy rating. The revision follows e.l.f. Beauty’s fourth-quarter results, which surpassed analysts’ sales and earnings expectations. According to InvestingPro data, the stock currently trades at a P/E ratio of 52.56, reflecting high market expectations for future growth.
e.l.f. Beauty’s fourth-quarter sales saw a 3.6% increase, outperforming both the company’s and market analysts’ projections, which anticipated growth between -1% and +2%. The adjusted earnings per share (EPS) of $0.78 also exceeded the expected range of $0.66 to $0.71, as well as surpassing the consensus estimates of $0.71 and $0.72. The company maintains impressive gross profit margins of 71.11%, with revenue growth reaching 46.27% over the last twelve months.
The company’s recent acquisition of skincare brand rhode skin was a significant development, with an $800 million price tag at closing and the potential for an additional $200 million tied to future performance milestones. Management emphasized the acquisition’s contribution to diversifying e.l.f. Beauty’s product portfolio and its expected positive impact on adjusted EBITDA margins and earnings. InvestingPro analysis shows the company maintains a healthy financial position with a current ratio of 1.9 and operates with moderate debt levels. Get access to 18 additional ProTips and comprehensive financial analysis with an InvestingPro subscription.
Despite not providing specific guidance for the first quarter of 2026 or the full fiscal year due to uncertainties surrounding tariffs, e.l.f. Beauty’s management expressed confidence in their ability to navigate these challenges, drawing on past experiences such as the 25% China tariffs in 2019. The company’s strong track record is reflected in its GREAT overall Financial Health Score on InvestingPro, indicating robust operational fundamentals.
Canaccord Genuity’s increased price target reflects the anticipated growth in earnings stemming from the rhode skin acquisition. The firm believes that the purchase was made at a reasonable price for a brand that is not only growing rapidly but also has significant potential for expansion both in the U.S. and internationally.
In other recent news, e.l.f. Beauty reported its fiscal fourth-quarter results for 2025, revealing earnings per share of $0.78, which surpassed the forecast of $0.73. The company’s revenue also exceeded expectations, reaching $332.6 million against the anticipated $327.99 million. In a strategic move, e.l.f. Beauty announced its acquisition of the skincare brand Rhode, founded by Hailey Bieber, for $1 billion. The acquisition is expected to enhance e.l.f. Beauty’s market position by expanding its product offerings and reaching new consumer segments, particularly through Rhode’s launch in Sephora stores across the United States, Canada, and the United Kingdom (TADAWUL:4280).
Analyst firms have responded positively to these developments. BofA Securities raised its price target for e.l.f. Beauty to $113, emphasizing the potential benefits of the Rhode acquisition. Similarly, Raymond (NSE:RYMD) James increased the price target to $105, noting the company’s strong fourth-quarter performance and international sales growth. Goldman Sachs maintained a Buy rating with a price target of $120, citing the strategic advantage of the Rhode acquisition and positive consumption trends in the first quarter.
Despite these positive financial results and strategic moves, e.l.f. Beauty refrained from providing specific guidance for fiscal year 2026 due to uncertainties related to tariffs. The company highlighted its efforts to mitigate tariff impacts through pricing adjustments, supply chain optimization, and business diversification. As e.l.f. Beauty continues to expand its international footprint and integrate Rhode, analysts remain optimistic about its growth potential.
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