e.l.f. Beauty is caught in a striking contradiction this week: the stock gained 7% while short sellers built their largest position in months, setting up a tension between recovering price momentum and rapidly accumulating bearish conviction.
The short-side story is the most compelling angle right now. Short interest has climbed to 18.5% of the free float — up 50% over the past month alone. That is a significant and accelerating build. Week-on-week the position grew nearly 12%, with daily estimates pushing above 11 million shares as of June 9. Yet the borrow market offers little pressure on those shorts. Cost to borrow remains negligible at just 0.62%, and while availability has tightened — falling from above 150% in mid-May to roughly 64% now — it still sits comfortably in the range where new short positions are easy to establish. This is a stock where shorts are building conviction, not being squeezed out.
Options positioning tells the opposite story, and that contrast is worth naming explicitly. Traders have turned meaningfully more bullish than usual over the past week. The put/call ratio dropped to 0.60 — more than two standard deviations below its 20-day average of 0.69, and close to the lowest reading of the past year. The sharp move in PCR matches the 7% weekly price gain, suggesting the options market is reflecting short-term bullish enthusiasm even as the short book expands. Two signals, two different crowds.
The Street has been cautious but not capitulating. Following the May 20 earnings print — where the stock barely moved on the day but rallied 8% over the subsequent five days — analysts across the board trimmed targets without abandoning positive ratings. JP Morgan kept Overweight while cutting its target to $80. BofA maintained Buy at $85. Morgan Stanley held Equal-Weight and trimmed to $59. The consensus price target now averages $72.40 against a closing price of $55.67, implying roughly 30% upside from current levels. Bears point to slipping market share in the Cheek category and tough quarterly comparisons ahead; bulls lean on international door expansion and the eye-products franchise, where ELF holds a 9% all-time-high share. The forward EPS growth factor ranks in the 96th percentile of the universe — a genuine standout — though the short score at 69.6 and a short-score rank in just the 8th percentile signal that quantitative short pressure remains elevated.
The insider picture complicates the narrative slightly. On June 4, five C-suite executives — including the CFO, COO, and Chief Marketing Officer — all sold shares at around $51.94, generating roughly $2.2 million in combined proceeds. The trades followed equity award grants on June 3, suggesting these were planned sell-to-cover transactions rather than discretionary exits. CEO Tarang Amin received the largest award of 71,167 shares and does not appear in the sell list, keeping his stake above 1.9% of the company. On balance, the insider activity reads as routine compensation mechanics rather than a directional signal.
Close peer EL gained 3.8% on the week, and IPAR added 5.6% — both broadly in line with ELF's 7% move, suggesting the personal care group had a firm week overall rather than ELF being an outlier on idiosyncratic news. What to watch next is whether the short interest build continues into August 5 earnings: if the position pushes above 20% of float while borrow availability keeps tightening, the setup heading into the next quarterly print becomes considerably more charged.
See the live data behind this article on ORTEX.
Open ELF on ORTEX →ORTEX Market Intelligence content is generated by AI from a snapshot of ORTEX's proprietary data. Content is informational only and does not constitute investment advice.
