e.l.f. Beauty: The Beauty Brand Buying Its Way to a Glow-Up in Growth?

Let me tell you, folks, there's a lot to unpack with e.l.f. Beauty (NYSE:ELF) right now. This isn't just another cosmetics company—it's a disruptor in the beauty space, leveraging strategic acquisitions, tariff-smart tactics, and a laser focus on skincare trends to carve out a winning path. If you're looking for a stock that's not just surviving but thriving in a slowing industry, keep reading.

The Acquisitions Play: Buying Growth, Not Just Brands

e.l.f. has been on a shopping spree, and it's paying off. The crown jewel here is the 2025 acquisition of rhode, Hailey Bieber's skincare brand, for up to $1 billion. . This isn't just a celebrity stunt. rhode's $212 million in annual sales and viral marketing machine—like its “glazed donut skin” trend—give e.l.f. a direct line to Gen Z and millennials. And with Bieber's 55 million Instagram followers, this is a content engine that could supercharge e.l.f.'s growth.

But rhode isn't the only star. The 2023 acquisition of Naturium, a skincare brand with a 40% gross margin, has already paid dividends. By integrating Naturium into its distribution network—think Ulta and Boots—e.l.f. is boosting its skincare presence without cannibalizing its core makeup sales. The result? A 28% jump in fiscal 2025 net sales, with 25 straight quarters of growth.

Tariff Resilience: Raising Prices, Not Surrendering

Let's talk about the elephant in the room: tariffs. With 75% of production in China and tariffs now hitting 55%, this could've been a disaster. Instead, e.l.f. fought back. A $1 price increase across its global product line (effective August 2025) is a masterstroke. Who cares if a lip balm jumps from $5 to $6 when you're the king of affordability? Pair that with supply chain tweaks and international expansion—sales in Mexico, Italy, and Germany are booming—and you've got a company that's not just surviving tariffs but using them as a catalyst.

Skincare Gold Rush: e.l.f. is the Miner with the Shovel

The skincare market is exploding, and e.l.f. is right in the sweet spot. The average price tag of $6.50 per product? Genius. When competitors like L'Oréal or Estée Lauder are chasing luxury, e.l.f. is owning the “clean, effective, and cheap” crowd. The rhode acquisition gives them a premium skincare entry point, while Naturium's distribution deals and e.l.f.'s own SKIN line create a three-pronged attack.

The Numbers: Cash, Earnings, and Momentum

e.l.f. isn't just talking a big game—it's delivering:
- Adjusted EBITDA up to $81M in 2025, a 34% jump from 2024.
- $149M in cash, up from $108M, with free cash flow nearly doubling to $115M.
- International sales hit $250M—a tenfold increase since 2016.

The Bottom Line: Buy the Dip, But Watch the Hype

Here's the play: e.l.f. is a buy on weakness. The stock has been overlooked in a volatile market, but with its acquisitions paying off and tariffs now manageable, this is a company primed to outperform.

Risks? Sure. rhode's success hinges on staying viral beyond Bieber's clout, and tariffs could spike again. But with a price-to-earnings ratio of 15—half that of L'Oréal—and a track record of execution, this looks like a steal.

If you're in for the long game, e.l.f. Beauty is a growth story with legs. The playbook is working—now it's time to let it run.

Action Alert: Consider adding ELF to your portfolio on dips below $25. A breakout above $30 could signal a new chapter in this beauty story.

This is not financial advice. Consult your advisor before making investments.