elf Beauty (ELF) Jumps 9.7% as Analyst Grows More Bullish Despite Product Price Increase

We recently published Wall Street Shockers: 10 Stocks on Fire. e.l.f. Beauty, Inc. (NYSE:ELF) is one of the best-performing stocks on Monday.

e.l.f Beauty saw its share prices jump by 9.73 percent on Monday to finish at $111.67 apiece as investors took heart from an investment firm’s bullish rating and price target upgrade for its stock.

In a market note, Morgan Stanley upgraded e.l.f. Beauty, Inc. (NYSE:ELF) to “overweight” from “equal weight” previously, alongside a higher price target of $134 versus $114 prior. The new price suggested a 20-percent upside potential from its latest closing price.

Last August 1, e.l.f. Beauty, Inc. (NYSE:ELF) slapped a 14-percent price hike on its products, saying that it would assess how consumers would respond.

“It will take a couple of weeks for that to fully roll out within retail. And so that is something that we’re watching for,” e.l.f. Beauty, Inc. (NYSE:ELF) CFO Mandy Fields has said.

However, Morgan Stanley posted a more optimistic outlook, saying that consumers typically do not tend to be especially sensitive to price increases “given the relative importance of beauty products to consumers.”

Additionally, it underscored that e.l.f. Beauty, Inc.’s (NYSE:ELF) products are relatively cheaper compared with those from its counterparts, and there is less opportunity for consumers to find more affordable substitutes.

While we acknowledge the potential of ELF as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock.