E.l.f. Beauty downgraded as 30 percent wiped from stock

E.l.f. Beauty downgraded as 30 percent wiped from stock

Four Wall Street firms have downgraded E.l.f. Beauty following a record drop in share value – down 30 percent to its lowest ever level, according to a report published by Bloomberg Quint.

As a mass market player, E.l.f. Beauty has suffered ‘subdued’ sales of late – part and parcel of the reason it is now being reclassified from ‘buy’ to ‘neutral’ by several firms, including Citi. The general trend is towards trading-up, with consumers increasingly turning to luxury products over their mass counterparts.

What’s more, Elf’s pricing model is dependent on low-cost manufacturing in China, which, with relations strained between the US and China, is considered at risk. The threat of higher margins has spooked the market, says Citi’s Wendy Nicholson.  

1 Comment

  1. NEIL FARMER ASSOCIATES

    The trade wars between the USA and China is a big factor in this. E.l.f is not alone in
    being dependent on low cost manufacturing in China. The outlook over the short /medium term
    must be cloudy, to say the least. Many businesses with emerging market exposure will also be concerned
    over the current global trade situation.

    Reply

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