U.S. Cosmetics Stocks Down 40% Last Year, Drops Another 6% Despite New 'Buy' Recommendation

ELF Beauty Inc. (NASDAQ: ELF) shares closed at $88.85—a 5.75% drop—on the NYSE on the U.S. trading day of the 25th. Its market capitalization fell to about $5.3 billion (approximately KRW 7 trillion), wiping out roughly $290 million (around KRW 400 billion) in a single session.

Recently, Citigroup initiated coverage on ELF Beauty with a Buy rating and a 12-month price target of $110, while research firm Wall Street Zen upgraded its prior Sell rating to Hold. The company is also accelerating its global footprint by partnering with H&M to launch its first fragrance collection—drawing inspiration from popular products such as Power Grip Primer and Halo Glow—later this month.

ELF Beauty, the U.S. cosmetics company best known for its budget-friendly color cosmetics brand e.l.f. Cosmetics, has grown rapidly through drugstores and online channels. However, in 2025, a slowdown in organic revenue growth and a high proportion of manufacturing in China increased its tariff burden, contributing to a nearly 40% plunge in its share price over the past year amid margin pressure and concerns over its elevated valuation.