Cosmetics Maker E.l.f. Beauty Announced Pricing of IPO, Shares Soar in First Day Trading


E.l.f. Beauty Inc. (NYSE:ELF), a discount cosmetics company, announced its pricing of IPO yesterday. Shares of the firm increased 59% in its debut on New York Stock Exchange on Thursday.

According to the statement, e.l.f. Beauty priced its IPO at $17.00 per share, which was higher than expectations of $14-$16 per share, for 8,333,333 shares of common stocks. 4,333,333 shares of common stocks will be sold by selling stockholders and another 4,000,000 shares of common stocks will be sold by e.l.f. Beauty itself. e.l.f. Beauty received $63.2 million before expenses, and selling shareholders received $68.5 million, according to the company.

The statement also said that the shares would be trading under the ticker “ELF” on September 22, 2016 on New York Stock Exchange. Underwriters have 30-day option to buy additional shares of common stock up to 1,250,000 shares from the selling shareholders at $17.00 per share. In addition, the offering was expected to close on September 27, 2016.

On the first day trading, stock opened at $24 per share and increased to the highest price of $27.09 per share. In the midday trading Thursday, the stock price was up 52% to $25.72 per share. The company was valued at more than $1 billion.

E.l.f. Beauty is a discount cosmetics company that sell beauty products at much cheaper prices, which are below prices in the department stores and specialty stores. The company said most of its products’ retailing price is at $6 or below. As of August, the company had nine retail stores in New York, and it also sold products online and in around 19,000 retail stores nationwide, such as Target, Walmart, and CVS. The company planned to open more stores in the United States, and expand its brands to skin care and more other products in the future.

In the offering, J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC acted as joint lead book-running managers, in addition, Piper Jaffray & Co. and Wells Fargo Securities, LLC also acted as book-running managers. William Blair & Company, L.L.C., Cowen and Company, LLC, and other four companies acted as co-managers.

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