A month has gone by since the last earnings report for e.l.f. Beauty (ELF Quick QuoteELF - Free Report) . Shares have added about 16.4% in that time frame, outperforming the S&P 500.

But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is e.l.f. Beauty due for a pullback? Well, first let's take a quick look at its latest earnings report in order to get a better handle on the recent catalysts for e.l.f. Beauty before we dive into how investors and analysts have reacted as of late.

e.l.f. Beauty Q1 Earnings Beat on Rhode Strength, Outlook Raised

e.l.f. Beauty began fiscal 2027 on a strong note, supported by exceptional demand for Rhode, robust international growth and continued momentum across its diversified beauty portfolio. The company also raised its full-year sales and earnings outlook.

ELF posted adjusted earnings of $1.75 per share, which jumped significantly from the year-ago period’s earnings of 89 cents and also beat the Zacks Consensus Estimate of 71 cents.

Net sales rose 36% to $479.4 million, surpassing the consensus estimate of $427 million. The company registered its 30th consecutive quarter of net sales growth, representing more than seven continuous years of expansion. Sales benefited from strength across retailer and e-commerce channels in the United States and international markets.

U.S. net sales increased 29%, while international net sales advanced 61%. Pricing and product mix contributed approximately 39 percentage points to growth. Unit volumes reduced growth by roughly three percentage points.

e.l.f. Beauty Benefits From Rhode Momentum

Rhode contributed approximately $160 million in first-quarter net sales, exceeding management’s expectations. The brand benefited from solid retail demand and a record-breaking summer innovation launch through rhodeskin.com.

The summer launch generated $27 million in direct-to-consumer sales in a single day. More than 70% of sales came from existing consumers, while the event attracted 90,000 new customers. Rhode is scheduled to launch with Sephora across 19 European countries in September.

ELF’s Cost & Margin Picture

Gross margin expanded approximately 1,400 basis points year over year to 83%. The increase included a benefit of nearly 1,050 basis points from approximately $50 million of IEEPA tariff refunds.

Excluding the refund benefit, gross margin still improved about 350 basis points, driven by pricing and lower year-over-year tariff rates. Management plans to reinvest the refunds during the remainder of fiscal 2027, primarily through selected price reductions and increased marketing spending.

Adjusted selling, general and administrative expenses surged to $260.7 million from $177.3 million. Adjusted SG&A represented 54% of net sales compared with 50% in the prior-year quarter, reflecting investments in personnel, infrastructure, merchandising and distribution.

Marketing and digital spending accounted for 22% of net sales, unchanged year over year but below management’s expectations due to the timing of expenditures. Adjusted EBITDA surged 93% to $168.2 million and represented 35% of sales. Excluding tariff refunds, adjusted EBITDA grew 36%.

ELF Maintains a Strong Liquidity Position

Cash and cash equivalents totaled $344.2 million at quarter-end, and total debt was $834.2 million.

Net cash provided by operating activities increased to $111.7 million during the first quarter.

The company repurchased approximately $50 million of common stock and repaid $7.5 million of long-term debt during the quarter.

e.l.f. Beauty Raises Fiscal 2027 Guidance

Management now expects fiscal 2027 net sales of $1,938-$1,968 million, implying growth of 18-20%. The prior outlook called for sales of $1,835-$1,865 million and growth of 12-14%.

Adjusted EBITDA is projected at $401-$407 million, while adjusted net income is expected to be $212-$215 million. Adjusted earnings are forecast at $3.50-$3.55 per share, up from the previous guidance of $3.27-$3.32. For the second quarter, management expects total net sales growth in the mid-30% range.

How Have Estimates Been Moving Since Then?

Since the earnings release, investors have witnessed a downward trend in estimates revision.

The consensus estimate has shifted -21.54% due to these changes.

VGM Scores

At this time, e.l.f. Beauty has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with a C. However, the stock has a score of F on the value side, putting it in the fifth quintile for value investors.

Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, e.l.f. Beauty has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.