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Shares in Elf Beauty sank after short seller Muddy Waters unveiled a bet against the US cosmetics maker.
The stock tumbled 15 per cent to $103, giving the Oakland-based company a market value of $6bn.
Muddy Water’s chief investment officer Carson Block announced the position against Elf on Wednesday at the Sohn Conference in London.
The company’s share price was down 15 per cent this year before the Muddy Waters announcement. The short seller stands to benefit financially as Elf’s share price falls.
Elf, short for EyesLipsFace, has developed a cult following among Gen Z and millennial consumers with low-priced vegan beauty products.
Elf did not immediately comment.
With additional reporting by Gregory Meyer
