Is e.l.f. Beauty Positioned for a Beat in Q1 Earnings Release?

Factors Likely to Influence ELF’s Upcoming Results

The inclusion of rhode is likely to have provided a significant boost to ELF’s fiscal first-quarter revenues. Management expects nearly $140 million in net sales contribution from the brand during the first four months of fiscal 2027. Continued strong retail demand, along with momentum from rhode’s expanding retail distribution, may have supported the company’s top-line growth.

Strength in Naturium and the broader skincare portfolio is also likely to have aided the quarter’s performance. On its last earnings call, management highlighted continued momentum in Naturium, supported by increased brand-awareness investments, while demand for rhode’s recent product launches remained encouraging. These factors may have helped diversify growth beyond the core e.l.f. brand and support overall sales.

ELF’s margins may have benefited from lower tariff costs and the carryover impact of prior pricing actions. Management expects these factors to support gross margin in the first half of fiscal 2027. The company’s continued investments in technology, automation and cost-saving initiatives may also have provided some operating support.

However, weakness in the core e.l.f. brand could have partly offset these gains. Management expects first-quarter organic sales to decline in the high-single-digit range, mainly due to the difficult comparison created by elevated shipments ahead of last year’s ERP transition. Slower-than-expected spring innovation, softer unit trends and continued investments in marketing and infrastructure could also have weighed on profitability.

Earnings Whispers for ELF

Our proven model predicts an earnings beat for e.l.f. Beauty this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is exactly the case here.

e.l.f. Beauty currently carries a Zacks Rank #3 and has an Earnings ESP of +5.23%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Other Stocks With the Favorable Combination

Here are some other companies worth considering, as our model shows that these, too, have the right combination of elements to beat on earnings this reporting cycle.

Kimberly-Clark Corporation KMB currently has an Earnings ESP of +1.43% and a Zacks Rank of 3. The Zacks Consensus Estimate for Kimberly-Clark’s upcoming quarterly revenues is pegged at $4.2 billion. The figure indicates a 1.7% increase from the prior-year quarter. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Kimberly-Clark’s quarterly earnings per share is pegged at $2.00, suggesting a 4.2% gain from the year-ago period figure. KMB delivered a trailing four-quarter earnings surprise of 19.1%, on average.

Monster Beverage Corporation MNST currently has an Earnings ESP of +2.61% and a Zacks Rank of 3. The consensus estimate for Monster Beverage’s quarterly revenues is pinned at $2.4 billion, which suggests 14.5% growth from the figure reported in the prior-year quarter. 

The Zacks Consensus Estimate for the upcoming quarter’s EPS is pegged at 59 cents, which calls for a 13.5% jump year over year. MNST delivered a trailing four-quarter earnings surprise of 9.6%, on average.

BellRing Brands, Inc. BRBR currently has an Earnings ESP of +4.55% and a Zacks Rank of 3. The consensus estimate for BRBR’s quarterly revenues is pinned at $561.7 million, which indicates 2.6% growth from the figure reported in the prior-year quarter. 

The Zacks Consensus Estimate for BellRing Brands’ upcoming quarter’s EPS is pegged at 37 cents, which implies a 32.7% decline year over year. 

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This article originally published on Zacks Investment Research (zacks.com).

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