e.l.f. Beauty pullback since earnings report ‘overdone,’ says Jefferies

Jefferies tells investors in a research note that the 20% pullback in e.l.f. Beauty shares since the August 8 print is overdone and has created an attractive entry point. The firm believes the Q2 EBITDA guidance calling for a 40% year over year decline caught people by surprise due to an earlier than expected rollout of Rossman in Germany, but still sees a path for second half EBITDA to accelerate to at least 80%, and while the Q1 sales beat was the smallest since December 2021, Jefferies believes the rest of the year’s estimates remain conservative. The firm made no change to its Buy rating or $220 price target.