Spruce strikes again! picks on elf

There’s no way this is a coincidence. That’s three times they’ve picked on stocks we cover here. I think we have a mole.

"Spruce Point Capital Management said on Thursday it had taken a short position in e.l.f. Beauty ELF citing “grave concerns” about the cosmetics and skincare maker’s partnerships with some of its vendors.

The company’s shares, which have risen over 77% this year, were down 1.4% at $96.77 in early trading.

The short-seller said shares of e.l.f. Beauty face up to 45% to 65% downside risk in the long term."

They went on to say there were “ethical concerns” about some of these partnerships but I can’t find a specific mention of neither the ethical concerns, nor the specific partnerships. Anyone else can dig this up?


Short Report Alert: NXIVM Sex Cult Ties Could Torpedo ELF Stock | InvestorPlace

Seems like they are reaching pretty hard to make a scandal.


This is the report:

After conducting a forensic financial review of e.l.f. Beauty (NYSE: ELF), one of the most richly valued stocks in the cosmetics and beauty industry, Spruce Point questions why e.l.f. partnered With Movers+Shakers, an advertising agency co-founded by former members of the NXIVM cult. We find evidence that suggests Movers+Shakers has messaging, branding and continued connections to the teachings of imprisoned cult leader Keith Raniere and his loyalists. The report reveals evidence that e.l.f. has used marketing messages that appear similar to those frequently used within the cult and urges retail partners including Target, Walmart and Ulta Beauty to reevaluate their connections with e.l.f. Based on our investigation, we estimate a 45% to 65% downside risk, or $34.35-$54.00 per share.

PowerPoint Presentation (website-files.com)

e.l.f. Beauty - https://assets-global.website-files.com/64dd091f91b3ca8e6309dc0d/654ce813639957c9a510e897_elf_research_thesis_11-9-2023.pdf (sprucepointcap.com)


First, I’m very ethically minded in my investments (why I wont’ invest in Tesla) but using an ad agency that was/is part of a cult is a stretch and doesn’t impact the growth of ELF. Also, Movers&Shakers was just bought by Stagwell last week, so NXIVM people may not even be involved anymore, if they even were.

Kind of shady that Spruce is actually contacting retailers to get them to reconsider ELF products because of their ties to Movers. Yeah, that’s gonna work!


I loathe these people, who manipulate stock prices with their short reports. Last time I remember, it was Lightspeed, right? I lost a lot of money after the short report was published and because of that, I sold out of my E.L.F. position immediately.

I am happy to buy in again, when the water calms again. But for now, I will put the money into MNDY and TTD.

Probably the worst what can happen is, that I will miss a big leg up from E.L.F.

But I would have preferred to stay into E.L.F.



I have seen a lot of short reports before, but this guy putting out a claim ELF has 60% downside because it is involved with a sex cult is definitely a first. Management shouldn’t even spend a second of their time trying to respond to this garbage.

Fwiw this marketing agency they are tying ELF to was/is also used by: Netflix, Chipotle, Neutrogena, Hasbro, Match.com. This short seller is only attacking ELF because?



I downloaded the report and also call complete bs here. They allege that the founders of the marketing company of elf may have been linked to a defunct cult in the “teaser” of their short report.

They then go on to say in their actual report:

“While it is important to recognize that neither of Movers+Shakers founders were alleged to have committed, or have been charged with, any wrongdoing, we find alarming evidence that Movers+Shakers and/or its founders may have continuing sympathy and/or affiliation with the teachings of NXIVM […]”

So they’re saying no-one even alleged any wrongdoing on the part of the founders, let alone them being charged with anything. That’s about all I need to know. But then they make the leap from the founders of M+S to the company M+S, to the company elf. And then goes on to say they found evidence that the company elf may have sympathy with the cult.

That affiliation or sympathy with the cult is apparently proven by the use of the word “joy” in their marketing messages…

Download the report and lose some valuable hours of your life if you wish to check, but I’m not doing anything based on this nonsense.