"One of my best investments this year will undoubtedly be e.l.f. Beauty . A big reason for this is that I was buying the stock this year on its dip into the $60s. At the time, investors were panicking after the company issued weak fiscal Q4 sales guidance. The cosmetics industry as a whole was feeling some pressure, while uncertainty over TikTok, where the company has a huge marketing presence, caused some headwinds."
"E.l.f.'s acquisition of Rhode, which closed in August, is a huge game changer for the company. Backed by celebrity Hailey Bieber, the brand was able to generate sales of $212 million in less than three years since its launch. While that is impressive on its own, what's even more impressive is that was done by only selling a handful of products on its website with little paid marketing."
E.l.f. Beauty captured significant mass-market share by resonating with younger consumers and expanding retail shelf presence. The company experienced short-term pressure from weak fiscal guidance, TikTok uncertainty, and tariffs that pushed the stock into the $60s. E.l.f. completed a $1 billion acquisition of Rhode, a high-end brand that generated $212 million in under three years with a small online product line and minimal paid marketing. Rhode adds higher price points, stronger gross margins, and celebrity-backed influence with Hailey Bieber remaining as chief creative officer. Expanding Rhode's product assortment and leveraging e.l.f.'s distribution and influencer strengths support future growth potential.
Read at The Motley Fool
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