Bernstein upgraded Elf Beauty to Outperform from Market-Perform and almost doubled its price target to $113 from $60, citing a more robust-than-anticipated start for the company’s recently launched hair care franchise. Shares of the company climbed more than 2% in premarket trading on the news.
The hair care line, introduced in June 2026, consists of six products priced between $6 and $10. This rollout represents Elf’s largest category expansion since it launched e.l.f. SKIN in 2022. Nielsen tracking shows hair care contributed roughly 3% of the company’s tracked sales in the weeks immediately following the launch, averaging 2.8% across the first three weeks after debut.
The initial distribution strategy began on TikTok Shop, then moved to the company’s direct-to-consumer website and Target.com, with in-store Target availability following in July. Bernstein highlighted that the category’s large base represents a significant opportunity for Elf.
Using Nielsen-tracked U.S. retail figures, Bernstein noted hair care is a $13.4 billion category, more than double the $5.9 billion skin care segment and far larger than the $1.5 billion fragrance market. The firm described hair care as "the largest white-space opportunity within beauty for e.l.f." Nielsen data show the category expanded at a 3.1% compound annual growth rate, rising from $11.9 billion in 2022 to $13.4 billion in 2026.
Bernstein drew a parallel with the earlier e.l.f. SKIN rollout, which saw market share increase from 0.6% in 2022 to 1.4% in 2026. Applying a comparable trajectory to hair care, the brokerage estimates Elf could achieve about a 0.9% share of the hair care category by 2029, which it says would equate to roughly $210 million in fully incremental annual net sales.
Reflecting the anticipated contribution from hair care, Bernstein raised its earnings-per-share growth forecast to 5% for the next twelve months and 14% for the subsequent year, up from previous estimates of 2% and 7%, respectively. The firm indicated this places its EPS outlook approximately 2% above consensus for the year following the next twelve months.
In addition to updating earnings assumptions, Bernstein widened its target multiple to 30 times from 17 times, citing both the stock’s recent re-rating and the prospect for additional multiple expansion as the projected growth becomes realized. The analysts added: "We believe e.l.f has the most relevant operating model for today’s consumer - social media fluency, rapid innovation cycles, and a viral-prone approach to new product development."
Context and implications
This upgrade ties directly to early sales data and distribution progress for Elf’s hair care entrance. The brokerage’s model revisions incorporate a projected cadence of sales growth and an expanded valuation reflecting improved growth visibility. The realization of Bernstein’s scenario depends on continued sales momentum, consumer reception beyond the initial weeks of tracking, and successful broader retail execution.