Factors Likely to Impact E.l.f. Beauty (ELF) in Q2 Earnings

E.l.f Beauty, Inc. ELF is scheduled to report second-quarter fiscal 2020 numbers on Nov 6. The company’s earnings outperformed the Zacks Consensus Estimate in three of the trailing four quarters, the average positive surprise being 72.2%. In the last reported quarter, it witnessed significant positive earnings surprise.

The Zacks Consensus Estimate for fiscal second-quarter earnings is pegged at 9 cents per share, indicating a decline of 47.1% from the year-ago quarter’s reported figure. The consensus mark for the same has been unchanged over the past 30 days. The consensus mark for revenues is pegged at $59.5 million, suggesting a decline of 6.8% from the year-ago quarter’s reported figure.

e.l.f. Beauty Inc. Price and EPS Surprise


e.l.f. Beauty Inc. Price and EPS Surprise

e.l.f. Beauty Inc. price-eps-surprise | e.l.f. Beauty Inc. Quote

Factors to Note

E.l.f Beauty has been facing headwinds related to high tariffs from escalated US-China trade war. Notably, the recent hike in tariffs of 10%, effective Sep 1, might have had an adverse impact on certain products, including brushes and tools. Moreover, tariff-related headwinds might have affected margins in the fiscal second quarter. However, any pricing actions and cost-saving plan undertaken by management might have aided in mitigating the impact of tariffs.

Further, it has been making efforts to enhance its digital capabilities. This along with a revamped Beauty Squad loyalty program might have worked in favor of the company in the fiscal second quarter.

Zacks Model

Our proven model predicts an earnings beat for E.l.f Beauty this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

E.l.f Beauty sports a Zacks Rank #1 and has an Earnings ESP of +10.71%.

Other Stocks With Favorable Combination

Here are some other companies you may want to consider as our model shows that these too have the right combination of elements to post an earnings beat:

Foot Locker FL has an Earnings ESP of +2.80% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Grocery Outlet Holding GO has an Earnings ESP of +2.70% and a Zacks Rank #2.

Ollie’s Bargain Outlet Holdings OLLI has an Earnings ESP of +3.45% and a Zacks Rank #3.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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