What Happened?
Shares of cosmetics company e.l.f. Beauty (NYSE: ELF) fell 8.2% in the afternoon session after investor fears grew over new tariffs on China, which triggered a broad-based market sell-off that hit consumer-focused stocks particularly hard.
The downturn was sparked after President Donald Trump threatened “massive” tariffs on China. This news caused major stock indexes to fall, with the S&P 500 dropping 1.8% and the tech-heavy Nasdaq sinking 2.5%. The consumer discretionary sector, which includes companies like e.l.f. Beauty that sell non-essential goods to consumers, was noted as one of the worst-performing groups during the market retreat. The negative sentiment across the market appeared to weigh heavily on the shares.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy e.l.f. Beauty? Access our full analysis report here.
What Is The Market Telling Us
e.l.f. Beauty’s shares are extremely volatile and have had 48 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 2 days ago when the stock gained 2.3% on the news that Morgan Stanley raised its price target on the stock, citing the strong performance and potential of the rhode skincare line. The investment firm increased its target to $170 from $134, the highest among analysts, while keeping its "Overweight" rating. The move came after rhode's "record-breaking" launch at Sephora stores. The bank's analysts described the rhode line as a "high-growth, high-margin complement" to e.l.f.'s main product portfolio. Strong sales data for the company's core e.l.f. brand also supported the firm's positive view on the stock's future.
e.l.f. Beauty is up 7.5% since the beginning of the year, but at $132.18 per share, it is still trading 9.9% below its 52-week high of $146.67 from September 2025. Investors who bought $1,000 worth of e.l.f. Beauty’s shares 5 years ago would now be looking at an investment worth $6,069.
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