e.l.f Beauty Shares Plunge. Should Investors Buy the Stock on the Dip or Stay Away?

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RegExp("[?&]notifications=1(&|#|$)");"desktop"===y&&i&&b.test(window.location.search)&&(i.checked=!0)};ge("ybar-mod-notification",(function(e){var t={isUH3:"crunch"===e.getConfig().ytheme,notifContainer:document.getElementById("notification-container"),notifBadge:document.getElementById("notif-badge"),notifMenu:document.getElementById("ybarNotificationMenu"),notifMenuOpener:document.querySelector("#ybarNotificationMenu + label"),notifDropdown:document.getElementById("notifDropdownContainer"),tooltipContainer:document.querySelector(".".concat($n)),notifLabel:document.querySelector(".".concat(Xn))};t.notifDropdown&&so(e,t)}))}()}};]]>Geoffrey Seiler, The Motley FoolSat, November 8, 2025 at 6:20 PM GMT+1 5 min reade.l.f. Beauty shares plunged after the company's guidance came up well short of expectations.The company has been dealing with tariff pressure.However, its long-term opportunity looks to remain intact.10 stocks we like better than Ulta Beauty ›It has been a roller-coaster ride for shareholders in e.l.f. Beauty (NYSE: ELF) over the past year. After a steep drop early this year and a strong rally following the company's May announcement of its plan to acquire Rhode, the stock was close to even for the year heading into its fiscal 2026 second-quarter report this week. But shares plummeted after it reported its results on Wednesday, and the stock is now down more than 40% on the year.Is the cosmetic company's latest dip a buying opportunity or should investors stay away?When e.l.f. Beauty reported its fiscal 2026 Q1 results, it did not provide full-year guidance due to uncertainty over how President Donald Trump's tariffs would affect the business and the broader economy, and there certainly seemed to be a disconnect when the company issued guidance this time around. It is also worth noting that, historically, e.l.f. management has tended to be very conservative with its guidance.For the fiscal year (which will end in March 2026), the company expects revenue to grow by 18% to 20% to a range of $1.55 billion to $1.57 billion, with adjusted EPS of between $2.80 and $2.85, down from $3.39 a year ago. Management projected that adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) would rise slightly from $297 million in fiscal 2025 to a range of $302 million to $306 million. Those numbers were all well below analysts' consensus expectations.Rhode is expected to contribute $200 million in revenue this fiscal year, and have a $300 million annual revenue run rate, which would provide the company with about 40% growth. Organic sales are projected to rise by between 3% and 4%. Shipments this year are expected to be lower than consumption after the company gained shelf space at Target last year and began selling its wares at Dollar General locations.In its fiscal second quarter, which ended Sept. 30, its sales rose 14% year over year to $344 million, which missed the analysts' consensus figure of $366 million. Rhode added $52 million to e.l.f.'s sales, but organic sales were down about 3%. The company said it temporarily held back shipments to some retailers that had not been quick to implement its $1 price increase in August, which impacted revenue in the quarter. 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