Beauty Stocks Like Coty, Estee Lauder Are Flying, But This Analyst Has Sights Set On The 'Best Performer'

Beauty Stocks Like Coty, Estee Lauder Are Flying, But This Analyst Has Sights Set On The 'Best Performer'
  • Morgan Stanley analyst Dara Mohsenian reiterated an Overweight rating on the shares of elf Beauty Inc ELF and raised the price target to $46 from $42, implying a 14% upside.
  • ELF remains the analyst's preferred SMID cap pick, with recent U.S. scanner data confirming potential fundamental upside near-term and driving higher estimates/price target.
  • Also ReadElf Beauty Outperforms Peers: Expect 16% Sales Growth In Fiscal 2023, Analyst Says
  • ELF momentum is being driven by its market share gains, which are accelerating as it implemented pricing with limited resulting volume demand elasticity, and as lower-price portfolio benefits from recent consumer trade-down, said Mohsenian.
  • The company's share gains, the analyst added, should also drive longer-term momentum with a virtuous cycle as retailers allocate more shelf space to ELF, driving sales.
  • The analyst considers topline upside should also allow for continued reinvestment in marketing, further supporting share gains.
  • Mass beauty category growth continues to recover post-COVID, specified Mohsenian.
  • Peer Coty Inc. COTY recorded 10% growth in its Q4 and predicted FY23 to be a year of continued expansion, in-line with medium-term growth targets.
  • Also ReadCoty Aims To Double Skincare Sales By FY25
  • Also, Goldman Sachs analyst Jason English upgraded Estee Lauder Companies, Inc. EL from Neutral to Buy and raised the price target from $298 to $303.
  • Price Action: ELF shares are trading higher by 1.72% at $40.20 on the last check Wednesday.
  • Photo Via Company

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