Elf Beauty's Growth Prospects Of Gaining More Shelf Space At Walmart, Target Impress This Analyst

DA Davidson analyst Linda Bolton Weiser reiterated a Buy rating on the shares of E.L.F. Beauty, Inc. ELF and raised the price target from $91 to $110.
The analyst notes CEO and CFO seemed confident in ELF's growth prospects.
The analyst views getting more shelf space at Walmart Inc. WMT and U.S. drug stores as ELF's biggest opportunity.
The analyst said the company can continue to grow without margin dampening infrastructure investments, for the time being.
Marketing return on investments are still increasing, and even with spending now at 19% of sales, the analyst thinks higher future ratios are possible.
Management believes the ELF brand has a strong competitive moat, in that it holds the first or second market share position in 12 mass color cosmetics sub-categories.
ELF's large and growing loyalty program enabled it to successfully navigate the online privacy changes that disrupted so many other digital marketers.
The analyst thinks the management is open to acquiring more brands, but private market valuations still seem slightly elevated; rather than repurchasing stock, they would like to keep some cash as dry powder.
Price Action: ELF shares are trading higher by 0.41% at $92.96 on the last check Wednesday.

Overview Rating:

Speculative

0100

Analyst Calendar