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On Wednesday, DA Davidson maintained a Neutral rating on e.l.f. Beauty (NYSE:ELF) shares, with a steady price target of $80.00, as the stock trades near $72.63. The firm’s analysis observed that e.l.f. Beauty’s point of sale (POS) data in the U.S. tracked channels showed a continued softening in the period ending February 8th. According to InvestingPro data, 17 analysts have recently revised their earnings expectations downward, with price targets ranging from $70 to $142. Compared to the same time last year, the growth for the March quarter-to-date has slightly increased to +0.1% from the previous +2.1%, despite having had an easier comparison from the prior year.
The recent week’s POS saw a decline of 5.8%, and sales have decreased year-over-year in four of the past six weeks. According to DA Davidson, e.l.f. Beauty’s fourth-quarter fiscal year 2025 sales guidance, projecting a range of -1% to +3% year-over-year, appears to be within reach. However, the firm expressed concerns about the company’s fiscal year 2026 guidance, which might fall short of the market’s expectations of +11% in sales growth and +13% in EBITDA growth.
The analysis highlighted that recent product launches by e.l.f. Beauty seemed to be more iterative, focusing on expanding existing lines rather than introducing completely new concepts. DA Davidson’s price target of $80 is based on a 15 times multiple of the firm’s estimated calendar year 2026 EBITDA of $314 million. InvestingPro’s Fair Value analysis suggests the stock may be undervalued despite current challenges, with additional insights available in the comprehensive Pro Research Report. The financial institution’s commentary provides a snapshot of e.l.f. Beauty’s current market performance and future expectations based on recent sales data and product development trends.
In other recent news, e.l.f. Beauty announced a revision of its fiscal year 2025 outlook, citing weaker-than-expected trends in January. The company now anticipates fourth-quarter sales growth of approximately 1%, significantly lower than the previously expected 19%, and adjusted EBITDA is projected to fall 15% below market consensus. This has prompted several analyst firms to adjust their price targets for the company. Stifel reduced its target from $105 to $85 while maintaining a Hold rating. Canaccord Genuity lowered its target to $105 but kept a Buy rating, noting the company’s third-quarter sales increase of 31.1% exceeded expectations. Raymond (NSE:RYMD) James also cut its target to $120, maintaining a Strong Buy rating, citing strong third-quarter results with a 31% sales increase. Goldman Sachs adjusted its target to $142, maintaining a Buy rating, while UBS downgraded the stock to Neutral and slashed its target to $74, highlighting concerns about the company’s future growth trajectory. These developments reflect a cautious outlook on e.l.f. Beauty’s near-term performance amidst a challenging market environment.
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