Intel stock spikes after report of possible US government stake
On Monday, DA Davidson analyst Linda Weiser revised the price target for e.l.f. Beauty (NYSE:ELF) shares, decreasing it to $75.00 from the previous $80.00, while retaining a Neutral rating on the stock. According to InvestingPro data, the stock has experienced significant volatility, with a 45.7% decline year-to-date, while maintaining impressive gross profit margins of 71.1%. The adjustment comes after a meeting with e.l.f. Beauty’s CEO, during which they discussed various aspects of the company’s performance and strategy, including a slowdown in point-of-sale (POS) growth, product innovation, infrastructure, tariffs, and international expansion. The company maintains a healthy financial position with a current ratio of 1.9, indicating strong liquidity to support its growth initiatives.
The analyst pointed out that last year’s lip oil product launch had a more significant impact than originally perceived by analysts, which has led to the current trend of flat to declining POS in U.S. tracked channels. In response to these trends, e.l.f. Beauty is advancing the timeline of a major product launch from summer to April in hopes of stimulating consumer demand.
Weiser’s report indicates that for a more positive outlook on e.l.f. Beauty, evidence of a recovery in U.S. POS growth to the range of 5%-10% is necessary. The revised price target reflects a lowered target multiple, moving from 15 times to 14 times, and is based on 14 times the company’s projected CY26E EBITDA of $314 million. The adjustment in price target and multiples indicates a cautious stance on the company’s near-term growth prospects. For deeper insights into e.l.f. Beauty’s valuation and growth potential, InvestingPro subscribers can access comprehensive financial health scores and 16 additional ProTips.
In other recent news, e.l.f. Beauty has secured a $500 million revolving credit facility, amending its existing credit agreement to introduce favorable changes in borrowing costs and financial covenants. This facility, maturing in 2030, is intended to support various corporate needs, including potential acquisitions. Additionally, e.l.f. Beauty has repurchased approximately $50 million of its common stock, leaving $450 million available under its 2024 Share Repurchase Program. Piper Sandler has reiterated its Overweight rating on e.l.f. Beauty, maintaining a price target of $102, despite a noted deceleration in sales. They express confidence in the company’s diverse channels, including international sales and digital platforms, to compensate for any U.S. market softness.
Meanwhile, DA Davidson has maintained a Neutral rating with an $80 price target, observing a decline in U.S. Point of Sale figures and expressing concerns about fiscal year 2026 guidance. Stifel has adjusted its price target to $85 from $105, citing e.l.f. Beauty’s lowered full-year guidance and weaker-than-anticipated sales trends. The company expects fourth-quarter sales for fiscal year 2025 to grow by approximately 1%, contrasting with the previous 19% consensus expectation. These developments highlight the challenges e.l.f. Beauty faces amidst a competitive beauty industry and shifting market conditions.
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