Gainey Mckenna & Egleston Announces A Class Action Lawsuit Has Been Filed Against E.L.F. Beauty, Inc. (ELF)

(MENAFN- GlobeNewsWire - Nasdaq) NEW YORK, March 07, 2025 (GLOBE NEWSWIRE) -- Gainey McKenna & Egleston announces that a securities class action lawsuit has been filed in the United States District Court for the Northern District of California on behalf of all persons or entities who purchased or otherwise acquired e.l.f. Beauty, Inc. (“Elf” or the“Company”) (NYSE: ELF) securities between November 1, 2023 and November 19, 2024, inclusive (the“Class Period”). The lawsuit seeks to recover damages for the Company's investors under the federal securities laws.

According to the Complaint, throughout the Class Period, Defendants made materially false and misleading statements regarding the Company's business, operations, and prospects. The Complaint alleges that specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) contrary to its representations to investors, the Company was experiencing rising inventory levels as a consequence of flagging sales; (ii) Elf falsely attributed the rising inventory levels to, among other things, changes in its sourcing practices; (iii) to maintain investor confidence, Elf reported inflated revenue, profits, and inventory over several quarters; (iv) accordingly the Company's business and/or financial prospects were overstated; (v) all of the foregoing, once revealed, would likely have a material negative impact on the Company; and (vi) as a result, the Company's public statements were materially false and misleading at all relevant times.

According to the Complaint, on November 20, 2024, Muddy Waters Research (“Muddy Waters”) published a report entitled“e.l.f. Beauty, Inc. A Revenue and Inventory Mystery” (the“Muddy Waters Report”), alleging that Elf had“materially overstated revenue over the past three quarters,” and that in“Q2 FY24, ELF management realized its growth narrative was in trouble as its inventory built. The Complaint further alleges that it appears that ELF then began reporting inflated revenue and profits. Its reported inventory also appears materially inflated as a result - i.e., to account for cash that has not really come in.” The Complaint further alleges, Muddy Waters accused the Company of concealing its inventory challenges from investors by falsely attributing its rising inventory levels to supposed changes in its sourcing practices rather than the true cause-insufficient sales.

The Complaint alleges that on this news, Elf's stock price fell $2.71 per share, or 2.23%, to close at $119.00 per share on November 20, 2024.

Investors who purchased or otherwise acquired shares of Elf should contact the Firm prior to the May 5, 2025 lead plaintiff motion deadline. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. If you wish to discuss your rights or interests regarding this class action, please contact Thomas J. McKenna, Esq. or Gregory M. Egleston, Esq. of Gainey McKenna & Egleston at (212) 983-1300, or via e-mail at ... or ... .

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