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e.l.f. Beauty, Inc. (NYSE:ELF) defied analyst predictions to release its first-quarter results, which were ahead of market expectations. It was a solid earnings report, with revenues and statutory earnings per share (EPS) both coming in strong. Revenues were 12% higher than the analysts had forecast, at US$123m, while EPS were US$0.27 beating analyst models by 47%. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
View our latest analysis for e.l.f. Beauty
Following the latest results, e.l.f. Beauty's eleven analysts are now forecasting revenues of US$457.7m in 2023. This would be a notable 9.6% improvement in sales compared to the last 12 months. Per-share earnings are expected to expand 13% to US$0.60. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$441.5m and earnings per share (EPS) of US$0.56 in 2023. It looks like there's been a modest increase in sentiment following the latest results, withthe analysts becoming a bit more optimistic in their predictions for both revenues and earnings.
With these upgrades, we're not surprised to see that the analysts have lifted their price target 12% to US$38.67per share. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values e.l.f. Beauty at US$44.00 per share, while the most bearish prices it at US$35.00. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting e.l.f. Beauty is an easy business to forecast or the the analysts are all using similar assumptions.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's clear from the latest estimates that e.l.f. Beauty's rate of growth is expected to accelerate meaningfully, with the forecast 13% annualised revenue growth to the end of 2023 noticeably faster than its historical growth of 9.1% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 9.4% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect e.l.f. Beauty to grow faster than the wider industry.