Is e.l.f. Beauty, Inc. overvalued or undervalued?

As of 7 July 2025, the valuation grade for e.l.f. Beauty, Inc. has moved from expensive to very expensive, indicating a significant increase in perceived overvaluation. The company is currently considered overvalued based on its high valuation ratios, including a P/E ratio of 59, an EV to EBITDA of 33.29, and a Price to Book Value of 8.71. In comparison, peers such as Reynolds Consumer Products, Inc. have a P/E of 15.06, while Coty, Inc. has a P/E of 25.97, highlighting the stark difference in valuation.
Despite the high valuation, e.l.f. Beauty, Inc. has outperformed the S&P 500 across multiple time frames, with a remarkable 3-year return of 272.54% compared to the S&P 500's 70.41%. This strong performance may suggest investor confidence, yet the elevated valuation ratios imply that the stock may be priced for perfection, making it a risky investment at current levels.