The investment case for e.l.f. Beauty presents a stark contrast. On one side, market researchers champion the stock as a prime opportunity. On the other, major financial institutions are executing significant sell orders. This divergence forces investors to weigh optimistic growth projections against the tangible actions of large-scale money managers.
Institutional Selling Pressure Emerges
Recent regulatory filings reveal a notable retreat by a key institutional holder. Harbor Capital Advisors Inc. slashed its stake in e.l.f. Beauty during the third quarter of 2025 by a substantial 67.6%. This move involved the sale of more than 40,000 shares. It follows an earlier transaction in October, where CEO Tarang Amin disposed of equity worth approximately $15.4 million. This pattern of selling by informed insiders and a major advisor introduces a note of caution amidst prevailing bullish sentiment.
The Bullish Analyst Perspective
Despite these sales, the analytical community maintains a favorable outlook. Following a significant share price decline this year, commentators like The Motley Fool have identified the stock as a compelling buy, even naming it one of their “3 Favorite Stocks to Buy” post-Christmas. Their thesis hinges on an attractive entry point and a price/earnings-to-growth (PEG) ratio below 0.4, suggesting undervaluation relative to growth prospects. Analysts also highlight potential from expanded retail distribution, including new brand partnerships such as Rhode at Sephora.
Should investors sell immediately? Or is it worth buying elf Beauty?
The consensus price target among analysts sits at $118. From current levels, this implies a potential upside of nearly 47%.
The Crucial Upcoming Catalyst
All attention now turns to a key upcoming event: the release of the company’s financial results for the third fiscal quarter of 2026, scheduled for February 5, 2026. This earnings report is widely seen as the critical test for e.l.f. Beauty. It will determine whether the company can substantiate its growth narrative and rebuild any shaken confidence. Until then, the stock is likely to experience continued volatility, caught between conflicting signals from Wall Street’s talking heads and its trading desks.
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