E.l.f. Beauty Stock Rises After It Disputes Short-Seller’s Report | Global News Avenue

Elf Beauty Company (Very low frequency) comes a day after Muddy Waters Research, publisher of a short-selling report, accused the cosmetics company of inflating its revenue, calling the report baseless.

Muddy Waters said in its report that ELF had overstated its revenue by as much as $190 million over the past three quarters. The article states that elf, which imports most of its products, reports that its revenue and inventory levels are rising, but its imported products have decreased significantly.

“To sell something, you have to actually own it,” Muddy Waters CIO Carson Block told CNBC.

Elf shares rose on Thursday after the company issued a statement saying Muddy Waters’ claims were baseless and that it had “full confidence in our financial statements.” The stock has recently risen about 4%, off Wednesday’s intraday lows.

The beauty brand said it asked U.S. Customs and Border Protection to keep its import data confidential in early 2024, meaning the data assessed by Muddy Waters “does not include the vast majority of our actual imports into the United States.”

“Muddy Waters made numerous inaccurate statements about elf Beauty and our business by relying on incomplete data and flawed assumptions, ignoring critical context and treating speculation as fact,” the cosmetics company said in a statement. ”

Elf shares are still down about 14% this year.