The cosmetics company announced a $1 billion acquisition, alongside strong earnings
e.l.f. Beauty Inc (NYSE:ELF) is surging 31.1% to $118.63, after announcing a $1 billion acquisition of Rhode, the skincare brand founded by Hailey Bieber. The deal will help elf Beauty expand its skincare footprint and appeal to higher-income consumers. CEO Tarang Amin praised Rhode’s rapid growth -- $212 million in net sales from just 10 products -- as “unprecedented.”
The news came alongside a strong fiscal fourth-quarter earnings report, with elf Beauty posting adjusted earnings of 78 cents per share on $333 million in revenue. Both figures topped Wall Street expectations of 72 cents and $328 million, though the company withheld full-year guidance due to tariff-related uncertainty.
Today’s rally has ELF trading at its highest level since January and narrows its year-to-date deficit to just 6%. While the equity still sports a year-over-year loss, it’s surged nearly 90% in the past month and just reclaimed its 200-day moving average -- a trendline that’s acted as resistance since last August.
At least four analysts hiked their price targets following the news, including Canaccord Genuity, which raised its target to $114 from $105. More upward revisions could follow, as the stock's average 12-month target of $99.22 still reflects a nearly 10% discount to current levels.
Options activity is red-hot, with more than 25,000 calls and 21,000 puts exchanged, or 13 times the average intraday volume. Traders are opening new positions at nine of the 10 most active contracts, led by the weekly 5/30 110-strike put.