e.l.f. Beauty (ELF) is in a "much better spot" after the reduction in China tariffs, and is now likely to deliver in-line fiscal Q4 results, Oppenheimer said in a Thursday note.

The cosmetics company will release its quarterly results on May 28.

Oppenheimer said it sees limited upside potential, but the company's fiscal Q4 results should at least be in line with Street estimates, while fiscal 2025 guidance is expected to be in line with the Street for both the top and bottom lines, with the international segment likely representing a material contributor to growth.

Pricing and innovation should help offset cost headwinds on the tariff front, consistent with the company's past successful mitigation efforts, Oppenheimer analysts said.

The tariff relief removes a major overhang on the company's shares and investor sentiment appears subdued, but the company continues to compete in a challenging mass cosmetics category, the analysts said, giving the stock a balanced risk/reward profile.

Oppenheimer has a perform rating on the company's stock.

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