Research from Water Tower Research, Water Tower Research

Water Tower Research

Water Tower Research is a leading equity research firm that provides research on micro, small and mid cap companies.

Water Tower Research was founded by Wall Street veterans after witnessing a fundamental shift in the investment research industry with the result being a declining knowledge base among investors, a lack of awareness and a shrinking pool of fundamental research being conducted on companies across the small-cap and micro-cap spectrum. The same issues are now increasingly occurring in the mid-cap space. This sea change within the investment community is impacting not only the companies themselves but also current shareholders and potential investors. With significantly less active sell-side sponsorship by Wall Street, a substantial information gap has developed between companies and various constituents in the financial community. The net result is fewer channels for insight and information to flow between companies and investors.

Research from Water Tower Research

Equity Research Firm

Equity Bottom-Up

<ul><li>4QFY26 results topped estimates across all key metrics. Net sales of $449.3MM increased 35% Y/Y, well above both our $418.8MM estimate and FactSet consensus of $423.0MM, with organic sales growth of 1% and rhode contributing $113MM.</li><li>Adjusted EPS of $0.32 exceeded our $0.28 estimate and consensus of $0.30.</li><li>Adjusted EBITDA of $59MM surpassed both our $48.2MM estimate and consensus of $50.4MM, though it declined from $81MM in 4Q25 as elevated marketing investment, including a Super Bowl campaign, and infrastructure spending pressured margins as expected.</li></ul>

4QFY26 results topped estimates across all key metrics. Net sales of $449.3MM increased 35% Y/Y, well above both our $418.8MM estimate and FactSet consensus of $423.0MM, with organic sales growth of 1% and rhode contributing $113MM.Adjusted EPS of $0.32 exceeded our $0.28 estimate and consensus of $0.30.Adjusted EBITDA of $59MM surpassed both our $48.2MM estimate and consensus of $50.4MM, though it declined from $81MM in 4Q25 as elevated marketing investment, including a Super Bowl campaign, and infrastructure spending pressured margins as expected.

ELF: Rhode Momentum Drives 4Q Upside; Initial FY27 Guidance Appears Conservative

elf Beauty Inc

ELF: Rhode Momentum Drives 4Q Upside; Initial FY27 Guidance Appears Conservative