FY26 Revenue
$1.636B
+24.5% YoY · 29th consec. growth qtr
Gross Margin
70.7%
Industry-leading for mass beauty
Free Cash Flow
$190M
+65% YoY despite integration costs
rhode Net Sales
$390M
In 8 months · 80%+ YoY growth
Analyst PT (avg)
$74.93
12 Buy · 4 Hold · 0 Sell
FY27 Guidance
$1.84–1.87B
+12–14% revenue growth guided
EV / Revenue
2.4×
EV ~$3.96B on FY26 revenue
Tariff Impact
~$50M
Annualized at current 55% China rate
Financial Performance
Revenue
Gross Margin %
Adj. EBITDA Margin %
| Metric | FY2022 | FY2023 | FY2024 | FY2025 | FY2026A | FY2027E | FY2028E |
|---|---|---|---|---|---|---|---|
| Revenue ($M) | 392 | 579 | 1,024 | 1,314 | 1,636 | ~1,855 | ~2,090 |
| YoY Growth | — | +47.8% | +76.9% | +28.3% | +24.5% | +13.4% | +12.7% |
| Gross Profit ($M) | 252 | 390 | 724 | 936 | 1,157 | ~1,335 | ~1,530 |
| Gross Margin % | 64.2% | 67.4% | 70.7% | 71.2% | 70.7% | ~71.9% | ~73.2% |
| GAAP Op. Income ($M) | 29.8 | 68.1 | 149.7 | 158.0 | 73.6 | ~115 | ~175 |
| GAAP Op. Margin | 7.6% | 11.8% | 14.6% | 12.0% | 4.5% | ~6.2% | ~8.4% |
| Adj. EBITDA ($M) | 54.6 | 85.3 | 182.6 | 206.2 | ~161 | ~215 | ~275 |
| Adj. EBITDA Margin | 13.9% | 14.7% | 17.8% | 15.7% | ~9.8% | ~11.6% | ~13.2% |
| GAAP Net Income ($M) | 21.8 | 61.5 | 127.7 | 112.1 | 26.3 | ~55 | ~100 |
| GAAP EPS (diluted) | $0.41 | $1.11 | $2.21 | $1.92 | $0.44 | ~$0.90 | ~$1.65 |
| Free Cash Flow ($M) | 14.7 | 100.2 | 62.5 | 115.3 | 190.1 | ~200 | ~240 |
| Net Debt ($M) | 73.6 | (38.6) | 182.4 | 164.3 | 627.2 | ~530 | ~420 |
FY ends March 31. GAAP figures sourced from SEC EDGAR 10-K filed 2026-05-21, audited by Deloitte & Touche. Adj. EBITDA per TipRanks non-GAAP data; excludes SBC, intangible amortization, and one-time items. FY24 revenue surge reflects partial-year Naturium acquisition. FY26 includes 8 months of rhode (closed Aug 5, 2025). FY27E–FY28E are Market Buzz internal estimates. Net Debt shown in parentheses when net cash.
GAAP vs. Adjusted — Bridging the Gap (FY2026)
The wide gap between GAAP and adjusted profitability in FY2026 is entirely attributable to the rhode acquisition accounting. Understanding this bridge is critical to assessing the true earnings power of the business.
| Line Item | FY2026 Amount | Nature | Cash Impact |
|---|---|---|---|
| GAAP Operating Income | $73.6M | GAAP Reported (10-K) | — |
| + Amortization of acquired intangibles | ~$50–65M | rhode & Naturium brand intangibles | Non-cash |
| + Stock-based compensation | ~$15–20M | Employee equity awards | Non-cash |
| + Integration & transaction costs | ~$5–10M | rhode deal-related one-time costs | Cash (one-time) |
| ≈ Adjusted Operating Income | ~$131M | Consistent w/ TipRanks non-GAAP | — |
| + D&A (excl. intangibles) | ~$29M | PP&E depreciation | Non-cash |
| ≈ Adj. EBITDA | ~$161M | 9.8% Adj. EBITDA margin | — |
| − Interest expense | ~$(50–55)M | On $917M acquisition debt (~5.5% rate) | Cash |
| ± Tax benefit / provision | varies | Deferred tax from non-cash items | — |
| GAAP Net Income | $26.3M | 10-K reported (Deloitte audited) | — |
Key Takeaway: The GAAP EPS of $0.44 drastically understates cash earnings power. Non-cash amortization (~$50–65M/year) from the rhode acquisition will persist for 10–15 years but does not represent economic value destruction. Free cash flow of $190M — which excludes these non-cash charges — is the most accurate measure of what the business generates. As rhode's intangibles are amortized over time and integration costs normalize, GAAP earnings will recover substantially toward FY28E.
Quarterly Revenue & Earnings Trend
rhode — The Acquisition That Changes Everything
rhode skin was founded in 2022 by Hailey Bieber and rapidly became one of the most talked-about skincare brands globally. Known for its minimalist packaging, high-efficacy formulas, and viral social media presence, rhode generated $212M in net sales in the twelve months ending March 31, 2025 — just three years after launch.
ELF announced the acquisition on May 28, 2025 (simultaneously with FY25 earnings), signaling high conviction. The deal closed August 5, 2025, and rhode was consolidated for approximately 8 months of FY2026.
The performance since closing has been exceptional. rhode delivered $390M in net sales across just 8 months of FY2026, growing 80%+ YoY. On an annualized run-rate basis, this implies ~$585M of annual net sales — meaning rhode effectively paid for itself in under 2 years on a revenue basis. The brand's success in the Sephora channel (becoming the #1 brand at Sephora North America within months of expanded distribution) validates ELF's distribution expertise.
| rhode Metrics | Value |
|---|---|
| Deal announced | May 28, 2025 |
| Deal closed | Aug 5, 2025 |
| Total deal value | Up to ~$1.0B |
| At close: cash | $600M |
| At close: ELF stock | $200M |
| Earnout (3-yr targets) | Up to $200M |
| LTM revenue at deal (Mar '25) | $212M |
| FY26 net sales (8 months) | $390M |
| FY26 global retail sales | $500M+ |
| YoY growth (FY26) | 80%+ |
| Sephora N. America rank | #1 beauty brand |
| Acquisition rev. multiple | ~4.7× LTM rev |
| Current annualized run rate | ~$585M+ |
Upcoming Catalysts for rhode
· Sephora Europe launch: 19 countries, September 2026
· Full year (12-month) FY27 consolidation — first full year
· Potential Sephora APAC expansion (Mecca ANZ already live)
· Earnout tracking → $200M upside but signals performance
· Hailey Bieber ongoing brand ambassador engagement
· Full year (12-month) FY27 consolidation — first full year
· Potential Sephora APAC expansion (Mecca ANZ already live)
· Earnout tracking → $200M upside but signals performance
· Hailey Bieber ongoing brand ambassador engagement
Peer Valuation Comparison
| Company | Mkt Cap | EV/Rev (TTM) | EV/EBITDA | Gross Margin | Rev Growth (1Y) | FCF Yield | Consensus |
|---|---|---|---|---|---|---|---|
| e.l.f. BeautyELF · NYSE | $3.33B | 2.4× | 24.6× | 70.7% | +24.5% | 5.7% | Strong Buy |
| Coty Inc.COTY · NYSE | ~$6.5B | 1.4× | ~11× | ~59% | ~+2% | ~4% | Buy |
| Estée LauderEL · NYSE | ~$26B | 2.5× | ~22× | ~73% | ~−5% | ~2% | Hold |
| EdgewellEPC · NYSE | ~$1.5B | 0.8× | ~9× | ~44% | ~−3% | ~6% | Hold |
| Inter ParfumsIPAR · NASDAQ | ~$4.1B | 3.5× | ~22× | ~51% | ~+6% | ~3% | Hold |
ELF trades at 2.4× EV/Revenue — cheaper than Estée Lauder (2.5×) and Inter Parfums (3.5×) despite having the highest gross margins in the group (70.7%) and the strongest top-line growth (+24.5%). The discount is entirely attributable to the current tariff overhang and integration noise. If ELF reverts to a 3.5–4× EV/Revenue (consistent with its own 2022–2023 trading range), fair value is ~$85–100+. Peer data approximate.
12-Month Price Target Scenarios
Bull Case
$115
+120% from current
Tariffs resolved / significantly reduced by H2 2026. rhode Europe launch (Sep '26) beats expectations — adds $150M+ in incremental FY27 net sales. Organic ELF core recovers to +5–8% growth. FY27 revenue beats at $2.0B+. Adj. EBITDA reaches $230M. Market assigns 4× EV/Revenue consistent with 2023 peak multiples. FCF yield compresses to 3% as profitability re-rates.
Base Case — Our PT
$75
+43% from current
Tariff situation gradually stabilizes. Supply chain diversification partially offsets $50M tariff cost. rhode FY27 delivers $480–520M net sales (full year + continued growth). FY27 revenue in-line at $1.87B. Adj. EBITDA recovers to ~$215M. Market assigns 3× EV/Revenue — modest re-rating from today's distressed 2.4×. GAAP EPS recovery to ~$0.90 as amortization flows through.
Bear Case
$35
−33% from current
Tariffs escalate to 80–100% on China goods; ELF unable to diversify fast enough. $80–100M annual tariff headwind. Organic ELF core sales decline 3–5% as price increases alienate value shoppers. rhode hype cycle fades post-acquisition. FY27 revenue misses low-end of guidance at $1.75B. Adj. EBITDA compresses to $130M. ELF approaches covenant pressure on $917M debt facility.
Catalyst Calendar — Next 12 Months
Aug 5, 2026
Q1 FY27 Earnings (First Full Quarter with rhode)
First quarter under FY27 guidance framework. Investors will focus on organic ELF growth vs. rhode contribution split, tariff cost disclosure, and any update to full-year guidance. Avg post-earnings move: ±14.3%. High volatility expected.
Sep 2026
rhode Sephora Europe Launch — 19 Countries
Catalytic international expansion of the rhode brand into a $15B+ European prestige beauty market. rhode's success at Sephora North America (#1 brand) and Mecca ANZ sets a high bar. Initial sell-through data will be closely watched by sell-side.
Ongoing
China Tariff Policy Developments
The U.S. Supreme Court invalidated prior IEEPA tariffs on Feb 20, 2026, creating ongoing legal uncertainty. Any judicial ruling, executive order, or trade negotiation outcome reducing China tariffs would be an immediate positive catalyst. Management to update supply chain diversification progress on each earnings call.
Nov 2026
Q2 FY27 Earnings — "Redemption Quarter"
Comparison against Q2 FY26's disastrous −6% revenue miss (stock −35%). An easy year-over-year compare + rhode's first full Q2 with Sephora Europe live = high probability of a beat. The "lap" of the worst quarter represents a significant positive setup.
Q3 FY27
Holiday Season Performance — rhode's First Full Holiday Under ELF
Holiday Q (Dec quarter) historically strongest for beauty. rhode's gift sets, limited editions, and increased shelf space at Sephora and Ulta could drive outperformance vs. FY26's already-strong Q3 ($490M, +71.5% EPS beat).
FY27 Year
e.l.f. SKIN + Naturium Integration — Mass Skincare Scaling
ELF has built a 3-brand skincare house (e.l.f. SKIN, Naturium, rhode) spanning mass to luxury price points. Success in scaling all three simultaneously — especially e.l.f. SKIN's rise from #25 to #11 in U.S. mass skincare — would demonstrate portfolio management sophistication and open a new revenue dimension.
Risk Register
High
China Tariff Escalation
75% of ELF's product volume is manufactured in China, facing a combined 55% tariff rate ($50M/year impact). If tariffs escalate to 80–100% before manufacturing diversification completes, annualized impact could reach $80–100M. Management is diversifying to Vietnam and Mexico, but supply chain transitions take 12–24 months. Near-term, every 10pp tariff increase ≈ $9M additional annual cost impact. This is the #1 risk to the investment thesis.
High
rhode Brand Momentum Risk
rhode's 80% growth rate is exceptional but inherently tied to social media virality and Hailey Bieber's ongoing engagement. Celebrity-founder brands historically risk losing momentum post-acquisition when the founder is no longer "all-in" on the brand. The $200M earnout structure incentivizes continued involvement, but brand heat is difficult to sustain at scale. If rhode's growth decelerates sharply to <20%, FY27 revenue will disappoint, and the $1B acquisition price will be questioned.
High
Balance Sheet Leverage
Net debt of $627M on a $3.33B market cap (18.8% of market cap) and $917M gross debt. Interest expense of ~$50–55M/year is a persistent drag on GAAP profitability. In a rising rate environment or credit stress scenario, refinancing terms could worsen. If revenue disappoints and FCF drops below $100M, covenant compliance becomes a concern. Debt-to-equity ratio of 0.81× is manageable but elevated vs. pre-acquisition levels of 0.2–0.45×.
Med
Core ELF Brand Deceleration
Organic ELF brand growth (ex-rhode) was only ~+1% in Q4 FY26. While partly attributable to tariff-driven price sensitivity and the one-time Q2 inventory disruption, sustained near-zero organic growth would indicate the core brand has saturated its mass retail penetration. The "dupe culture" that built ELF is now being applied to ELF itself by private-label competitors at Walmart and Amazon, creating commoditization risk in the sub-$10 price tier.
Med
Insider Selling / Governance Signal
TipRanks' insider sentiment score is 0.0 (Sell), with $989K in insider selling vs. $962K in buying over the trailing period. While the amounts are small in absolute terms, selling at sub-$60 prices by insiders who have seen the business from the inside warrants monitoring. Management's refusal to provide FY27 EPS guidance (citing tariff uncertainty) may reflect greater internal concern than the bullish revenue guidance implies.
Low
Consumer Macro / Discretionary Spending
Despite ELF's value positioning, beauty remains discretionary. A severe consumer recession could reduce overall category spend. Historically, however, the "lipstick effect" (consumers trading down to affordable treats during downturns) has benefited mass beauty brands like ELF. The 2020 COVID period saw ELF grow sequentially as consumers shifted to value. This risk is mitigated by ELF's value-for-money positioning.
Market Sentiment Dashboard
Smart Score
5 / 10
Neutral · Updated May 29
Analyst Consensus
Strong Buy
12B / 4H / 0S
Hedge Fund Signal
Buy
Score: 0.89 / 1.0
Insider Activity
Sell
Score: 0.0 · Monitor
Blogger Sentiment
100% Bull
10 bullish / 0 bearish
News Sentiment
Positive
Score: 1.0 (max)
Technical Signal
Strong Sell
1 Buy · 15 Sell
Investor Score
0.87
High retail interest
Sentiment Interpretation: The polarization between institutional signals (hedge funds buying, analysts at Strong Buy, bloggers 100% bullish) and technical signals (Strong Sell across all moving averages) is characteristic of a deep-value setup where the stock has been caught in a momentum-driven downdraft. Hedge fund accumulation at these levels is particularly constructive — institutional investors with fundamental models are buying the dip while technical traders sell the breakdown. The single wildcard is insider selling, which warrants close monitoring in the next two quarters.
Valuation Framework
EV / Revenue (FY26A)
2.4×
EV ~$3.96B on $1.636B revenue. Implies <2.2× on FY27E $1.86B — historically cheap for a brand growing 13%+ with 70% gross margins.
EV / Adj. EBITDA (FY26A)
24.6×
Elevated on compressed FY26 EBITDA (~$161M). Drops to ~18.4× on FY27E ~$215M — reasonable for the growth profile.
FCF Yield
5.7%
$190M FCF / $3.33B market cap. Strong and improving. At $75 target price (~$4.77B mkt cap), still a healthy 4.0% FCF yield.
Price-to-Sales (FY26)
2.0×
$3.33B mkt cap / $1.636B revenue. Trading at 2× revenue for a #1 mass beauty brand growing 25% with 70%+ gross margins is historically unprecedented cheapness for ELF.
PT Derivation — Blended Methodology
| Methodology | Multiple / Assumption | FY27 Base | Implied Value | Weight |
|---|---|---|---|---|
| EV / Revenue | 3.0× (vs. 2.4× current) | $1.855B FY27E revenue | ~$79/share | 40% |
| EV / Adj. EBITDA | 20× (modest expansion) | ~$215M FY27E Adj. EBITDA | ~$72/share | 35% |
| FCF Yield | 4.5% target yield | ~$200M FY27E FCF | ~$70/share | 25% |
| Blended Price Target | — | — | ~$75/share | 100% |
All estimates are Market Buzz internal projections. Implied share price uses ~63.7M fully diluted shares outstanding and net debt of ~$530M (FY27E, after FCF paydown). PT of $75 represents 43% upside from $52.31.
Bottom Line
Investment Conclusion · BUY · Price Target $75 · 43% Upside
e.l.f. Beauty is one of the most structurally advantaged consumer brands in the U.S. — the #1 mass color cosmetics brand for 29 consecutive quarters, built on an unmatched value-for-money proposition and a speed-to-market capability (13–20 weeks) that allows it to ride TikTok trends faster than any competitor. The current selloff, driven by a single quarter's revenue miss (Q2 FY26), acquisition leverage from rhode, and China tariff fears, has created a pricing dislocation that we do not believe reflects intrinsic value.
rhode is performing dramatically better than any pre-acquisition model could have assumed: $390M in net sales in just 8 months, 80%+ YoY growth, and the #1 ranking at Sephora North America within months of expanded distribution. The Sephora Europe launch across 19 countries (September 2026) is an under-appreciated catalyst that could add $100–150M incrementally to FY27/28 revenue. Meanwhile, free cash flow improved to $190M in FY2026 despite the integration noise — the business is generating real cash even while the P&L shows compression.
The key risk is tariffs: 75% China manufacturing exposure at 55% tariff rates creates a $50M annual headwind. We view this as a solvable problem (diversification to Vietnam/Mexico underway) and partially mitigable through price and supplier concessions. The Supreme Court's February 2026 ruling invalidating prior IEEPA tariffs creates ongoing legal uncertainty that could resolve favorably. At 2.4× EV/Revenue with 70%+ gross margins, a growing $500M+ rhode brand, and $190M of annual free cash flow, ELF represents a compelling risk/reward with 43% upside to our $75 target and 120%+ upside in a bull case. We rate ELF a BUY.
rhode is performing dramatically better than any pre-acquisition model could have assumed: $390M in net sales in just 8 months, 80%+ YoY growth, and the #1 ranking at Sephora North America within months of expanded distribution. The Sephora Europe launch across 19 countries (September 2026) is an under-appreciated catalyst that could add $100–150M incrementally to FY27/28 revenue. Meanwhile, free cash flow improved to $190M in FY2026 despite the integration noise — the business is generating real cash even while the P&L shows compression.
The key risk is tariffs: 75% China manufacturing exposure at 55% tariff rates creates a $50M annual headwind. We view this as a solvable problem (diversification to Vietnam/Mexico underway) and partially mitigable through price and supplier concessions. The Supreme Court's February 2026 ruling invalidating prior IEEPA tariffs creates ongoing legal uncertainty that could resolve favorably. At 2.4× EV/Revenue with 70%+ gross margins, a growing $500M+ rhode brand, and $190M of annual free cash flow, ELF represents a compelling risk/reward with 43% upside to our $75 target and 120%+ upside in a bull case. We rate ELF a BUY.
DISCLAIMER: This report is produced by Market Buzz Research for informational purposes only and does not constitute investment advice, a recommendation, or an offer to buy or sell any security. All data sourced from TipRanks, SEC EDGAR (10-K filed 2026-05-21, audited by Deloitte & Touche LLP), company press releases, and publicly available information. Analyst consensus data per TipRanks. Rhode acquisition details per ELF 8-K (May 28, 2025) and investor press releases. Estimates and projections are Market Buzz internal forecasts and may differ materially from actual results. Past performance is not indicative of future results. Investors should conduct their own due diligence. June 2, 2026.