You told me to check your ideas with my tool 😬 As I said, it's designed for my barbell strategy.
Here is the analysis for e.l.f. Beauty (ELF), based on the latest figures from February 2026 (Q3 Annual Report 2026).
1. standard key figures (status quo)
Basis: share price ~$85.50 | market capitalization ~$4.8bn
P/E ratio (price-earnings ratio): ~45
(Growth valuation. The market is pricing in high future profits here)
P/E ratio (price-sales ratio): ~3.5
P/B ratio (price-to-book ratio): ~6.4
KCV (price-cash flow ratio): ~37
Dividend yield: 0.00
(Does not pay a dividend)
2. core quality formula (your quality check)
Target: > 25 (very good), 15-25 (solid), < 15 (schwach)
Hier spielt e.l.f. Beauty seine Stärke aus. Das Unternehmen wächst extrem dynamisch.
Umsatzwachstum: +38 % (Q3 2026 vs. Vorjahr)
Operative Marge: ~12 % (GAAP) bis 25 % (Adj. EBITDA)
(Ich rechne konservativ mit der GAAP-Marge von ca. 12 %. Die bereinigte EBITDA-Marge liegt deutlich höher, aber wir wollen "echte" Qualität messen.)
Dein Score: 50 (38 + 12)
Bewertung: Hervorragend (> 25).
According to your core formula, this is an absolute top value. The growth is massive ("Growth Stock"), and the company is already profitable.
3. cash flow quality formula (substance check)
Target: FCF yield > 5 % (attractive), > 8 % (very attractive)
Operating cash flow: ~$135m (TTM)
CapEx: ~$20-30m (investments in IT/logistics, less capital-intensive)
Free cash flow (FCF): ~$110m
FCF yield: ~2.3% (110m FCF / 4,800m market cap)
Valuation: Unattractive / Expensive.
The stock is too expensive for your "cash machine" logic. You are paying a high premium for growth here. An FCF yield of 2.3% is far below your buy threshold of 5%.
4. dividend filter (income core)
Requirement: Yield >= 3.5%
Yield: 0.0%
Rating: Failed.
e.l.f. reinvests every cent in marketing and expansion. The share is unsuitable for an income strategy.
5. exclusion rule (warning signals)
Sales growth stagnating/negative? No (on the contrary, +38% is extremely strong).
Operating margin permanently < 5%? Nein (Solide zweistellig).
Story > figures? Borderline case. The figures are very good (growth), but the valuation (P/E ratio 45) is strongly based on the expectation that this growth will continue for years to come.
Conclusion for you
The company is a pure growth candidate.
According to your core quality formula: A clear buy (score 50!). It is exactly the kind of "qualitative growth" that this formula is supposed to find.
According to your cash flow & dividend filters: A clear non-buy. Too expensively valued for value investors, no payout.
My recommendation based on your profile:
Since you wrote that you use the Core Quality Formula for "Growth Stocks", e.l.f. Beauty fits perfectly into this specific "satellite" portfolio for growth. It perfectly fulfills the requirements for quality growth (profitable + fast growing). For the conservative/dividend part of your portfolio, however, it is nothing.
Here is the analysis for e.l.f. Beauty (ELF), based on the latest figures from February 2026 (Q3 Annual Report 2026).
1. standard key figures (status quo)
Basis: share price ~$85.50 | market capitalization ~$4.8bn
P/E ratio (price-earnings ratio): ~45
(Growth valuation. The market is pricing in high future profits here)
P/E ratio (price-sales ratio): ~3.5
P/B ratio (price-to-book ratio): ~6.4
KCV (price-cash flow ratio): ~37
Dividend yield: 0.00
(Does not pay a dividend)
2. core quality formula (your quality check)
Target: > 25 (very good), 15-25 (solid), < 15 (schwach)
Hier spielt e.l.f. Beauty seine Stärke aus. Das Unternehmen wächst extrem dynamisch.
Umsatzwachstum: +38 % (Q3 2026 vs. Vorjahr)
Operative Marge: ~12 % (GAAP) bis 25 % (Adj. EBITDA)
(Ich rechne konservativ mit der GAAP-Marge von ca. 12 %. Die bereinigte EBITDA-Marge liegt deutlich höher, aber wir wollen "echte" Qualität messen.)
Dein Score: 50 (38 + 12)
Bewertung: Hervorragend (> 25).
According to your core formula, this is an absolute top value. The growth is massive ("Growth Stock"), and the company is already profitable.
3. cash flow quality formula (substance check)
Target: FCF yield > 5 % (attractive), > 8 % (very attractive)
Operating cash flow: ~$135m (TTM)
CapEx: ~$20-30m (investments in IT/logistics, less capital-intensive)
Free cash flow (FCF): ~$110m
FCF yield: ~2.3% (110m FCF / 4,800m market cap)
Valuation: Unattractive / Expensive.
The stock is too expensive for your "cash machine" logic. You are paying a high premium for growth here. An FCF yield of 2.3% is far below your buy threshold of 5%.
4. dividend filter (income core)
Requirement: Yield >= 3.5%
Yield: 0.0%
Rating: Failed.
e.l.f. reinvests every cent in marketing and expansion. The share is unsuitable for an income strategy.
5. exclusion rule (warning signals)
Sales growth stagnating/negative? No (on the contrary, +38% is extremely strong).
Operating margin permanently < 5%? Nein (Solide zweistellig).
Story > figures? Borderline case. The figures are very good (growth), but the valuation (P/E ratio 45) is strongly based on the expectation that this growth will continue for years to come.
Conclusion for you
The company is a pure growth candidate.
According to your core quality formula: A clear buy (score 50!). It is exactly the kind of "qualitative growth" that this formula is supposed to find.
According to your cash flow & dividend filters: A clear non-buy. Too expensively valued for value investors, no payout.
My recommendation based on your profile:
Since you wrote that you use the Core Quality Formula for "Growth Stocks", e.l.f. Beauty fits perfectly into this specific "satellite" portfolio for growth. It perfectly fulfills the requirements for quality growth (profitable + fast growing). For the conservative/dividend part of your portfolio, however, it is nothing.
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@Raketentoni MEGA, thank you, I agree, growth and quality have their price
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