e.l.f. Beauty Is Looking Good Again: Reversal in Play

Key Points

• e.l.f. Beauty is on track to rebound in 2026 as it regains traction, gains market share, and outperforms estimates.
• Analysts are lifting price targets, pointing to a 40% gain at the consensus. 
• Institutional activity aligns with a market bottom, having shifted to accumulation in early 2026.

e.l.f. Beauty NYSE: ELF struggled in 2025 with consumer shifts, slowing growth, and the less-than-spectacular rollout of the rhode makeup and skincare brand. But that was then—this is now.

Now, the fiscal Q3 results have revealed that consumers are resilient and that the bottom has not fallen out of the cosmetic market. Now, rhode has gained traction. The critical takeaway from the Q3 results is that e.l.f. absolutely crushed the low bar analysts set, and the guidance is equally optimistic. (Note that e.l.f. Beauty has a fiscal year that is ahead of the calendar year.)

Forecasting more than 20% growth in 2026, guidance outpaced consensus by a significant margin, and could be cautious.

e.l.f. Beauty Dazzles in Q3, Raises Guidance, Analysts Cheer

e.l.f. Beauty had a rocking quarter in its fiscal Q3 2026, growing revenue by 37.8% to $489.5 million. The top line outperformed reported consensus by 600 basis points, driven by strength in retail and ecommerce channels, both domestically and abroad. Among the strengths was a solid UK rhode rollout and margin, which significantly outperformed analyst forecasts and company guidance. 

Margin news included contraction at the gross and operating levels; however, the impacts of tariffs were less than expected. Additionally, selling, general, and administrative expense increases were centered on marketing, merchandising, and other expansionary activities.

This increased spending drove growth across the company and should be contained in future quarters. As it stands, cash flow remains healthy, and the $1.24 in adjusted EPS was up 67% year-over-year (YOY) and outperformed consensus by an even wider margin than revenue. 

The company’s year-to-date (YTD) performance on the balance sheet included notable concerns, including increased debt. However, debt still remains relatively low at approximately 1X equity. Also, the cash position is healthy, and equity is rising. The most significant risk to investors is dilution, but the threat is minimal. The share count has increased by less than 1.25% YTD, and expansion is not expected to accelerate. 

Analysts Raise e.l.f. Price Targets, Confirm Market Bottom

Analysts noted concerns about e.l.f.’s valuation and growth trajectory following its earnings, but held firm on their ratings. Some even raised their price targets. The activity affirms the Moderate Buy rating and confirms the bottom in price action, which began forming in 2025.

While sentiment has held firm at Moderate Buy over the trailing 12 months, price target reductions impacted market activity in 2025. However, that headwind is now gone. Now, analyst sentiment is likely to continue firming as the year progresses, underpinned by solid results and outperformance. 

Institutional trends likewise signal a shift in market dynamics. The group, which owns more than 90% of the stock, sold on balance in the back half of 2025 but reverted to accumulation in early 2026. This activity aligns with the late-2025 price bottom and 2026 rebound, providing a support base and market tailwind to lift price action this year. The risk is that institutions revert to distribution, but that is unlikely given the company’s performance and growth outlook. 

e.l.f. Beauty Sets Up to Move Higher

The price action in ELF is not out of the weeds yet, but is showing signs of a hard bottom and potential to move higher within its trading range. The indicators align with this move, revealing a momentum shift and a market with ample room to run.

The resistance targets include a cluster of moving averages near $100 and the consensus $120. A move to consensus would be worth approximately 40% from the pre-release close, while a move into the high-end range (likely by year’s end) adds double-digits to the gain.