e.l.f.(ELF) ZACKS·2025-02-14 15:31Group 1 - e.l.f. Beauty has an average brokerage recommendation (ABR) of 1.67, indicating a consensus between Strong Buy and Buy from 18 brokerage firms, with 66.7% of recommendations being Strong Buy [2][4] - The ABR should not be the sole basis for investment decisions, as studies suggest brokerage recommendations often lack success in guiding investors towards stocks with significant price appreciation potential [4][9] - Analysts from brokerage firms tend to exhibit a strong positive bias in their ratings, with a ratio of five "Strong Buy" recommendations for every "Strong Sell" [5][9] Group 2 - The Zacks Rank, a proprietary stock rating tool, is a more reliable indicator of near-term price performance, classifying stocks from Zacks Rank 1 (Strong Buy) to Zacks Rank 5 (Strong Sell) [7][10] - The Zacks Rank is based on earnings estimate revisions, which have shown a strong correlation with near-term stock price movements, unlike the ABR which may not be up-to-date [10][11] - For e.l.f. Beauty, the Zacks Consensus Estimate for the current year has declined by 14.7% to $3.33, leading to a Zacks Rank 5 (Strong Sell) due to analysts' growing pessimism about the company's earnings prospects [12][13]