ELF

Shares of e.l.f. Beauty, Inc. Plunge 28% on Lowered Full-Year Guidance

A woman having multiple cosmetic products applied to her face.

What happened

Shares of e.l.f. Beauty, Inc. (NYSE: ELF) , a multi-channel brand retailer and distributor of high-quality cosmetic and skin care products, plunged 28% as of 1:38 p.m. EDT Thursday after announcing second-quarter earnings.

So what

Revenue during the second quarter increased 6% to $59.1 million, compared to the prior year, which was in line with analysts' estimates. Adjusted earnings-per-share checked in at $0.13, which is more than double analysts' estimates calling for adjusted earnings of $0.06 per share.

In a press release, Chairman and CEO Tarang Amin said:

Now what

Despite meeting estimates on the top line and beating them on the bottom line, its outlook for the rest of the year raised concern. Management lowered its full-year 2018 revenue guidance to low single digits from its prior range of between 6% and 8% . It lowered its adjusted EBITDA from a range of $65 million to $66.5 million down to between $58 million and $62 million. It also dropped the bottom end of its adjusted earnings per share from $0.59 per share down to $0.56 per share, while leaving the top end at $0.61 per share.

Management made it clear that it's time to increase investment behind its brands because the competition for younger consumers is fierce, but that's a move that came late and could make the back half of 2018 a little more painful than anticipated.

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Daniel Miller has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy .

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


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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