Jefferies bearish on brick and mortar beauty retailers

Brokerage Jefferies cuts PT on CoverGirl parent Coty COTY.N and cosmetics retailer Ulta Beauty ULTA.O, says e-commerce companies are winning market share

Cuts Coty's PT to $7 from $8; shares down as much as 1.6%

Slashes Ulta's PT to $334 from $354; says co is losing offline retail market share to Sephora due to its more upmarket offerings, appeal to young shoppers

Notes Amazon has been the biggest winner within beauty, taking market share from Ulta, Sally Beauty SBH.N and Build-A-Bear BBW.N

Sees TikTok Shop to evolve into a key beauty marketplace, given its proximity to product discovery and affiliate-linked content

However, sees makeup company Elf Beauty ELF.N being relatively well-positioned for shift to digital, given co-owned website, early social media adoption and minimal exposure to department stores

Including session moves, ULTA and COTY has fallen 15% and 22% respectively, YTD