12:32 PM EDT, 08/07/2025 (MT Newswires) -- E.l.f. Beauty (ELF) has a "glass half full" on product pricing dynamics, benefits from the Rhode skin care brand acquisition and a resilient margin outlook, despite tariff turmoil and "significant base business volatility," Morgan Stanley said Thursday in a report.

Morgan Stanley reiterated its equalweight rating on e.l.f. stock "with pricing a large net benefit even after tariffs and demand elasticity, and clear long-term Rhode EPS accretion, albeit with still uncertain base business trends, with volatile US scanner data growth but solid international growth."

E.l.f. implemented average price increases of $1 per product, which may generate $184 million in incremental sales, more than compensating for the expected $50 million in annual tariff pressure, the report said.

Morgan Stanley boosted its price target on e.l.f. stock to $114 from $105.

On Wednesday, e.l.f. reported fiscal Q1 adjusted earnings that fell less than expected by Wall Street analysts as revenue rose more than forecast. Citing tariff-related uncertainty, the company withheld full-year guidance.

E.l.f shares dropped 13% in Thursday trading.

Price: 95.99, Change: -14.40, Percent Change: -13.04