$ELF (+0,74%)
@Dividendenopi
@Semos25
Guys, if you want to hear my personal opinion. For me, Elf Beauty is one of the best consumer goods stocks.
Elf Beauty significantly exceeded market expectations on Wednesday with a 38% increase in sales to USD 489.5 million and at the same time raised its forecast for the full year. The Group's share price initially rose by up to 15% in after-hours trading before giving up most of these gains. Unexpectedly high revenues from the integration of the Rhode brand and adjusted earnings per share of USD 1.24, which were well above the consensus estimate of USD 0.72, were the main reasons for the business performance.
CEO Amin points to 28 quarters of growth and massive gains in market share
The management emphasizes the remarkable consistency of the operational development. CEO Tarang Amin emphasized that the results are not a one-off effect, but part of a long-term success story. "Our Q3 results are a continuation of the consistent, category-leading growth we have delivered over the past 28 quarters," Amin said in his statement. He also defined the strategic pillars of success: "Our value proposition, powerful innovation and disruptive marketing engine continue to drive our brands." This momentum is evident globally, as growth is broadly based across various retail channels as well as in e-commerce.
Hailey Bieber's Rhode brand exceeds plans with USD 128 million sales contribution
At the center of the latest developments is the integration of model Hailey Bieber's skincare brand Rhode. This acquisition, for which Elf Beauty spent around USD 1 billion, is becoming a decisive catalyst in the product portfolio. In the past third quarter, Rhode already contributed USD 128 million to net sales. In this context, Amin explicitly referred to a "record-breaking start for Rhode at Sephora in the UK", which underlines the international scalability of the new division. As a result of this momentum, the company has massively revised its expectations for the subsidiary upwards: Elf Beauty now projects that Rhode will contribute up to USD 265 million to net sales in the current year. This corresponds to an increase of USD 65 million compared to the previous guidance.
A 38% jump in sales leads to an increase in the annual forecast
The 38% jump in sales to USD 489.5 million in the third quarter clearly beat analysts' estimates of USD 460 million. In the same period of the previous year, sales amounted to USD 355 million. Profitability also developed strongly. Net profit rose to USD 74.5 million, compared to USD 43 million in the previous year. In view of this performance, management now expects sales to exceed the previous estimate by a range of USD 42 million to USD 50 million.
The Rhode acquisition is paying off at record speed and cements the growth course
The operating figures demonstrate the immediate profitability of the acquisition strategy: with a contribution of USD 128 million to quarterly sales, the Rhode brand is already recouping more than 10 % of the purchase price in just three months following the USD 1 billion acquisition. The fact that Elf Beauty has raised its sales forecast for this division alone by USD 65 million to USD 265 million shows that the integration is taking effect faster than planned. Despite the volatile share price reaction, the increase in the full-year forecast by up to USD 50 million shows that the combination of core business and new acquisitions is extremely financially resilient.
