In this article, we will look at the 12 Best Cosmetics Stocks to Buy for 2025.
Overview of the Cosmetics Industry
According to Grand View Research, the global cosmetics industry has a market size of around $295.95 billion as of 2023. It is expected to grow at a compound annual growth rate of 6.1% between 2024 and 2030. The primary driver of this growth is the rising awareness among consumers about improving their external appearance. Products such as makeup, hair care, skin care, and color cosmetics have become essential parts of everyday life, leading to their increased demand. Another factor supporting market expansion in this sector is the introduction of non-toxic, natural, and organic cosmetic products.
The online cosmetics market is reflecting similar trends. According to a report by Mordor Intelligence, the online cosmetics market had a size of $16.23 billion in 2025. It is expected to grow at a compound annual growth rate of 8.47% between 2025 and 2030, reaching $24.37 billion at the end of the forecast period.
READ ALSO: 15 Best Blue Chip Stocks to Buy According to Billionaires and Top 10 Restaurant Stocks to Buy Under $20.
What Would Trump’s Tariffs Mean for the American K-Beauty Cosmetic Industry?
South Korea takes the lead for cosmetic imports, but a 25% tariff could be imposed on the country if President Trump decides to give the green signal after a 90-day pause on a majority of his new reciprocal tariffs. On April 16, CBS News reported that the US imported more than $7.5 billion in cosmetics last year, according to estimates made by the US International Trade Commission. Around $1.7 billion of these imports came from South Korea, as American retailers are seeing a significant boom in the K-beauty industry with the sale of Korean skincare, hair care, and makeup products. This trend is partly emerging due to social media influencers consistently promoting K-beauty products.
However, the imposition of Trump’s tariffs could result in a significant price hike for these products, which is why consumers are “panic-buying” their favorite Korean products, according to CBS News. These trends are also proving worrisome to the Personal Care Products Council, a trade association representing more than 600 brands such as Estée Lauder, Procter & Gamble, L’Oréal, and Neutrogena.
The association said in a statement that it is particularly “concerned about trade policies that could result in higher prices for personal care products,” adding that US consumers use “about six to 12 products each day, including sunscreen, toothpaste, shampoo, moisturizer, and fragrance.”
With these trends in view, let’s look at the 12 best cosmetics stocks to buy for 2025.
Our Methodology
We sifted through stock screeners, financial media reports, and ETFs to compile a list of 40 cosmetics stocks and chose the top 12 most popular among hedge funds as of Q4 2024. The list is ordered in ascending order of hedge fund sentiment. We sourced the hedge fund sentiment data from Insider Monkey’s database.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
12 Best Cosmetics Stocks to Buy for 2025
12. The Honest Company, Inc. (NASDAQ:HNST)
Number of Hedge Fund Holders: 25
The Honest Company, Inc. (NASDAQ:HNST) is a personal and household care company that provides non-toxic natural products, including skincare, health and wellness products, wipes, bath products, home cleaning, and diapers. It operates as an omnichannel brand that offers products through digital and retail channels. The company’s three product categories include skin and personal care, household and wellness, and diapers and wipes.
In a report released on March 10, Aaron Grey from Alliance Global Partners maintained a Buy rating on the company with a price target of $8.00. The company is planning a significant strategic pivot by gradually moving away from its direct-to-consumer fulfillment operations to focus on more profitable retail and digital partnerships. With $75 million in cash and zero debt, The Honest Company, Inc. (NASDAQ:HNST) is in a solid position to continue its transformation strategy, which is why analysts are bullish on the stock.
The Honest Company, Inc. (NASDAQ:HNST) also reported positive results in 2024, hitting record revenue, gross margins, and adjusted EBITDA. It reported a revenue of $378 million, reflecting a 10% year-over-year growth. Its gross margins expanded 900 basis points to 38%. This was the highest annual revenue and gross margin ever for the company. It also delivered its first full year of positive adjusted EBITDA as a public company.
Meridian Contrarian Fund also expressed bullish sentiments for the stock and stated the following regarding The Honest Company, Inc. (NASDAQ:HNST) in its Q4 2024 investor letter:
“The Honest Company, Inc. (NASDAQ:HNST) is a consumer products company focused on developing natural baby-care consumables, cosmetics, soaps, and other household supplies. The company went public in 2021, bolstered by pandemic-driven demand for its cleaning products. However, subsequent global supply chain challenges created headwinds for the smaller company, presenting a contrarian investment opportunity. We view the Honest brand as an authentic differentiator that has demonstrated growth despite operational challenges that previously impacted its earnings potential.
The company’s outperformance during the quarter and throughout 2024 was driven by sustained sales growth and notable improvements in gross margins, marking its first profitable year on an adjusted EBITDA basis. As Honest expands its product offerings in beauty categories aligned with consumer preferences for cleanly formulated skincare products—a segment we believe the company is well-positioned to succeed in—we remain optimistic about its long-term prospects. While we reduced our net shares held following the strong performance in the quarter, we maintain conviction in its growth potential.”
11. Coty Inc. (NYSE:COTY)
Number of Hedge Fund Holders: 28
Coty, Inc. (NYSE:COTY) is a beauty company that operates a portfolio of brands in color cosmetics, fragrance, and skin and body care. Its Prestige segment operates an array of luxury brands, including Gucci, Marc Jacobs, Miu Miu, Tiffany & Co., Kylie Cosmetics by Kylie Jenner, Hugo Boss, Burberry, Chloe, Calvin Klein, SKKN BY KIM, and more. The company markets and sells its products in more than 121 countries across the globe. Coty, Inc.’s (NYSE:COTY) mass beauty products are primarily sold through supermarkets, hypermarkets, drugstores, department stores, e-commerce retailers, and other channels.
On April 1, RBC Capital analyst Nik Modi maintained a Buy rating on Coty, Inc. (NYSE:COTY) and set a price target of $13.00. Berenberg analyst Fulvio Cazzol also initiated coverage of the company on March 25 with a Buy rating, setting a $7.50 price target. The analyst told investors in a research note that the firm anticipates the beauty industry in developed markets to return to the 3% to 3.5% growth range, with China potentially stabilizing in H1 2025 and returning to growth in the year’s second half. Emerging markets are also expected to grow by around 8% in 2025.
The analyst thus believes that Coty, Inc. (NYSE:COTY) is approaching trough relative valuation multiples and the stock’s “story is about to become more interesting.” The company ranks 11th on our list of the best cosmetics stocks to buy for 2025.
10. Nu Skin Enterprises, Inc. (NYSE:NUS)
Number of Hedge Fund Holders: 29
Nu Skin Enterprises, Inc. (NYSE:NUS) is an integrated wellness and beauty company that develops and markets an elaborate range of products in around 50 markets worldwide. It has three brands: Nu Skin, Pharmanex, and ageLOC. Nu Skin is a beauty brand, while Pharmanex and ageLOC are wellness and anti-aging brands, respectively.
The company reported better-than-expected fiscal Q4 2024 earnings, with revenue reaching $445.6 million and adjusted EPS of $0.38. Despite foreign currency headwinds, Nu Skin Enterprises, Inc. (NYSE:NUS) expects strong 2025 earnings and revenue guidance.
On January 3, the company announced the completion of a strategic transaction between its Rhyz Inc. subsidiary and Later, a portfolio company of Summit Partners. Rhyz Inc. sold Mavely, its affiliate marketing technology platform, to Later for approximately $250 million cash and a minority equity stake in the combined Later/Mavely business.
This strategic transaction gave the company around five times the return on its cumulative investments in Mavely since its acquisition in 2021. The proceeds from this transaction are expected to help Nu Skin Enterprises, Inc. (NYSE:NUS) fund innovation in its offerings and pay down debt. The company also plans to use its strengthened balance for share buybacks under its existing stock repurchase program, providing value to its shareholders. It ranks tenth on our list of the top cosmetics stocks to invest in for 2025.
9. Unilever PLC (NYSE:UL)
Number of Hedge Fund Holders: 31
Unilever PLC (NYSE:UL) is a fast-moving consumer goods (FMCG) company that operates through five segments: Personal Care, Nutrition, Beauty and Well-Being, Home Care, and Ice Cream. Unilever PLC (NYSE:UL) offers over 400 brands worldwide. Its Beauty & Well-being segment includes skin care, hair care, and prestige beauty, while the Personal Care segment includes oral care products, deodorant, and skin cleansing, making it one of the best cosmetics stocks to buy according to hedge funds.
On April 15, Barclays analyst Warren Ackerman maintained a Buy rating on Unilever PLC (NYSE:UL). In a report released on April 14, Celine Pannuti CFA from J.P. Morgan also maintained a Buy rating on the company.
The company’s EPS slightly exceeded analyst consensus expectations of £2.965 in fiscal Q4 2024, reaching £2.98, primarily due to solid operational efficiency. However, revenue for the quarter reached £14.2 billion, missing the anticipated £15 billion. The revenue miss was primarily due to currency exchange headwinds and certain market challenges.
Despite that, Unilever PLC (NYSE:UL) reported significant growth across its core brands, with its Power Brands collectively posting a 5.3% increase in underlying sales. The Beauty & Well-being segment underwent a 6.5% growth, while the Personal Care segment attained a 5.2% increase. This growth was attributed to a robust performance by brands such as Sunsilk and Vaseline in Beauty & Well-being and deodorant line innovations in Personal Care.
8. e.l.f. Beauty, Inc. (NYSE:ELF)
Number of Hedge Fund Holders: 35
e.l.f. Beauty, Inc. (NYSE:ELF) is a multi-brand beauty company that ranks on our list because of its clean, vegan, cruelty-free, and accessible cosmetics and skincare products. Its brand portfolio includes e.l.f. Cosmetics, e.l.f. SKIN, Naturium, Well People, and Keys Soulcare. The company’s operations span eye, lip, face, makeup, beauty tools, accessories, and skincare products, all 100% vegan. e.l.f. Beauty, Inc. (NYSE:ELF) takes the eighth spot on our list of the best cosmetics stocks to buy for 2025.
On April 9, Canaccord analyst Susan Anderson opined that the weakness in the company’s shares due to the tariff situation in the country posits a significant buying opportunity. The stock’s shares present a positive risk/reward opportunity after undergoing a fall of approximately -60% YTD because of tariffs and slowing tracked sales. The firm believes that e.l.f. Beauty, Inc. (NYSE:ELF) has a playbook that can absorb the effects of tariffs, aggressively estimating that around 70% of its items are exposed to Chinese tariffs. Canaccord thus maintained its buy rating for the company, setting a $105 price target on Elf Beauty shares.
The company also has strong operations. Fiscal Q3 2025 marked its 24th consecutive quarter of net sales growth and market share gains, ranking e.l.f. Beauty, Inc. (NYSE:ELF) among a rarefied group of high-growth companies. It is one of the only six public consumer companies out of 546 that has grown for 24 straight quarters and averaged at least 20% sales growth per quarter. Furthermore, e.l.f. is the only brand among nearly 1,000 cosmetics brands tracked by Nielsen to gain share for 24 consecutive quarters.
Polen US Small Company Growth Strategy stated the following about e.l.f. Beauty, Inc. (NYSE:ELF) in its Q3 2024 investor letter:
“The Portfolio’s top detractors were Progyny, elf Beauty, and Alarm.com. E.l.f. Beauty, Inc. (NYSE:ELF), a discount beauty company focused on cosmetics and skin care, is a new addition to the Portfolio this quarter. Please see Portfolio Activity below for further detail. We are intrigued by the company’s impressive track record for growth, margins, and returns on capital. While elf has reported significant results all year, shares came under pressure, in our view, as short-term investors primarily appeared to anticipate a slowdown in revenue growth, possibly due to investor concerns of market saturation, economic conditions, and valuation concerns, among other factors. While we are confident in how we underwrote our initial investment for returns above the portfolio average, the stock has come under even more pressure than we anticipated. We used this weakness to add to our position. We’re intrigued by the strength elf has experienced across its retailer and ecommerce channels, particularly in taking market share in a challenging consumer environment, given their relatively inexpensive prices vs. competitors.
Elf Beauty, described above, is a discount beauty company focused on cosmetics and skincare. We find the company’s reputation for quality, innovation, and prices below mass cosmetics brands to be uniquely positioned. While this combination of innovation, quality, and value has led to compelling growth, we still believe it’s early days for the company. Elf’s brand awareness is significantly less than that of more prominent players; it is still adding shelf space, expanding its product portfolio, and entering the skincare market. Elf is also still a US-focused business, with some early signs of international success. The company’s financial profile is strong, and we expect EPS to grow by 25% over the long term.”
7. Sally Beauty Holdings, Inc. (NYSE:SBH)
Number of Hedge Fund Holders: 36
Sally Beauty Holdings, Inc. (NYSE:SBH) is an international specialty retailer specializing in professional beauty supplies. Its operations span two segments: Beauty Systems Group (BSG) and Sally Beauty Supply. The company offers over 7,000 products in the hair care, hair color, hair styling tools, and nails categories. Its proprietary brand portfolio includes Bondbar, Strawberry Leopard, Generic Value Products, and more.
Although the company’s revenue growth is modest, its margin expansion reflects a significant opportunity. Sally Beauty Holdings, Inc. (NYSE:SBH) has significantly improved its operating margin, rising 330 basis points to 10.7%. This shows that the company’s strategic efficiencies and cost-cutting initiatives are supporting profitability. Its focus on improved inventory management, disciplined pricing, and digital transformation is strengthening the company’s financial health.
Sally Beauty Holdings, Inc. (NYSE:SBH) is also well-positioned to improve its profitability in the future by leveraging its e-commerce expansion, strong supply chain, and disciplined capital deployment. Investors are thus bullish on the stock, and its median price target of $8.01 implies an upside of 74.78% from current levels. The company takes the seventh spot on our list of the best cosmetics stocks to invest in for 2025.
6. Kenvue Inc. (NYSE:KVUE)
Number of Hedge Fund Holders: 38
Kenvue Inc. (NYSE:KVUE) is a consumer health company that operates through three segments: Skin Health and Beauty, Self Care, and Essential Health. Its Skin Health and Beauty segment offers hair care, body care, face care, and other product categories. The Essential Health segment comprises baby care, women’s health, oral care, and more. The company’s global footprint spans more than 165 countries across its four regions. It ranks sixth on our list of the best cosmetics stocks to invest in, according to hedge funds.
On April 14, Citi raised the firm’s price target on Kenvue Inc. (NYSE:KVUE to $22 from $21, keeping a Neutral rating on its shares as part of a fiscal Q1 earnings preview for the household and personal care and beverage group. Kenvue Inc. (NYSE:KVUE) reported adjusted earnings per share (EPS) of $0.26 in fiscal Q4 2024, which is in line with analyst expectations. Although the company faced some headwinds, it managed to improve its operating income margins and gross profit year-over-year, reflecting operational efficiency gains.
Kenvue Inc. (NYSE:KVUE) owns popular brands such as Tylenol and Listerine and maintains its competitive edge through continuous innovation and strong brand recognition. It has recently focused on improving its brand investments and implementing operational efficiencies to boost growth. The company operates globally, and its relationship with Johnson & Johnson, its parent company, reinforces its market standing by supporting its research capabilities and supply chain.
5. Spectrum Brands Holdings, Inc. (NYSE:SPB)
Number of Hedge Fund Holders: 38
Spectrum Brands Holdings, Inc. (NYSE:SPB) is an online retailer and global manufacturer of branded home essentials and consumer products. It offers small household appliances, lawn and garden products, home pest control products, and others. The company manufactures, sells, and markets its products across Europe, the Middle East and Africa, North America, Latin America, and Asia-Pacific.
On March 30, RBC Capital analyst Nik Modi maintained a Buy rating on Spectrum Brands Holdings, Inc. (NYSE:SPB) and set a price target of $110.00. Analysts are bullish on the stock, and its median price target of $59.15 implies an upside of 78.36% from current levels.
In Q1 2025, Spectrum Brands Holdings, Inc. (NYSE:SPB) reported a 1.2% growth in net sales, while organic sales grew by 1.9%. This growth was attributed to strategic investments in fiscal 2024 to enhance commercial operations and accelerate revenue growth. At the end of the quarter, the company had around $180 million in cash, with approximately $491 million available from its $500 million cash flow. It is the fifth-best cosmetic stock to buy for 2025.
4. The Estée Lauder Companies Inc. (NYSE:EL)
Number of Hedge Fund Holders: 45
Estée Lauder Companies Inc. (NYSE:EL) is a globally popular manufacturer of hair care, skincare, makeup, and fragrance. Its elaborate product portfolio includes Estée Lauder, Clinique, MAC, Bobbi Brown, Jo Malone London, Too Faced, La Mer, and others. The company sells its products through multi-brand retailers, department stores, prestige salons and spas, upscale perfumeries, and pharmacies.
In a report released on April 1, Nik Modi from RBC Capital maintained a Buy rating on Estée Lauder Companies Inc. (NYSE:EL) and set a price target of $100.00. The company has been experiencing negative trends in its operations since last year. It reported a 6% drop in revenue to $4.0 billion in fiscal Q2 2025. The center of these struggles for The Estée Lauder Companies Inc. (NYSE:EL) is weak consumer spending in China and a drop in the Asia Travel business, which comprises a majority of Chinese travelers purchasing products abroad.
However, the company’s new CEO has announced a “Beauty Reimagined” reinvention plan with five action plans to help the company recover. These plans include accelerating best-in-class consumer coverage, creating transformative innovation, accelerating new consumer acquisition by boosting consumer-facing investments, fueling sustainable growth through bold efficiencies, and reimagining operations by simplifying the organization. The Estée Lauder Companies Inc. (NYSE:EL) takes the fourth spot on our list of the best cosmetics stocks to buy for 2025.
3. Ulta Beauty, Inc. (NASDAQ:ULTA)
Number of Hedge Fund Holders: 47
Ulta Beauty, Inc. (NASDAQ:ULTA) is a beauty retailer that offers merchandise in various categories, including hair care, skincare, cosmetics, hair styling, and more. Its stores also offer several beauty services, focusing on hair, makeup, skin, and brow. The Ulta Beauty store prototype includes an open salon area on the salon floor. It offers its customers a new way to shop by bringing together “All Things Beauty, All in One Place.”
The company’s brick-and-mortar offerings and digital presence are both significant parts of its strategic standing. It sells hundreds of beauty brands in its stores, provides curbside pickups and delivery services, and also offers shop-in-shop partnerships, such as its partnership with Target.
In a report released on April 8, Simeon Gutman from Morgan Stanley maintained a Buy rating on Ulta Beauty, Inc. (NASDAQ:ULTA) and set a price target of $460.00. The analyst is bullish on the company due to its growth potential and strong market position. It is focused on the US market, and is exhibiting resilience in the beauty category, which positions it to deal with economic uncertainties.
The analyst also told investors that Ulta Beauty, Inc.’s (NASDAQ:ULTA) sourcing strategy has limited exposure to tariffs and is supported by a strong domestic supply chain, which further supports its position amid global trade tensions. The company also has strategic initiatives to drive sales growth and support its brands, including the introduction of innovative products and expansion into personalized and wellness offerings. Ulta Beauty, Inc. (NASDAQ:ULTA) has no debt on its balance sheet, ranking it third on our list of the best cosmetics stocks to buy now and making it a compelling investment.
2. Colgate-Palmolive Company (NYSE:CL)
Number of Hedge Fund Holders: 62
Colgate-Palmolive Company (NYSE:CL) manufactures and sells various products for the personal and home care markets and operates in two product segments: Oral, Personal, and Home Care, and Pet Nutrition. The Oral, Personal, and Home Care segment sells cleaning products worldwide. Its brand portfolio includes several reputable brands, including Colgate, Palmolive, Irish Spring, Sorriso, Protex, meridol, Axion, Sanex, and others.
On March 24, Bank of America Securities analyst Bryan Spillane maintained a Buy rating on Colgate-Palmolive Company (NYSE:CL). The company reported strong operational results in fiscal Q4 2024, with gross margin rising 70 basis points to 60.3%. Colgate-Palmolive Company (NYSE:CL) also maintained its dominant position in the global toothpaste market with 41.4% and manual toothbrushes with 32.2% global market share.
On March 20, the company raised its quarterly common stock cash dividend to 52c per share, up from 50c per share, effective in H2 2025. The company has been paying uninterrupted dividends on its common stock since 1895. Diamond Hill Large Cap Strategy also expressed bullish sentiments on the stock, and stated the following regarding Colgate-Palmolive Company (NYSE:CL) in its Q4 2024 investor letter:
“As valuations have continued rising and the economic cycle has gotten relatively long in the tooth, we’ve thought carefully about where and how we are exposed to more cyclical stocks. As such, we initiated just two new positions in Q4: Colgate-Palmolive Company (NYSE:CL) and the aforementioned Lululemon.
Colgate-Palmolive is a high-quality business with leading positions in oral care, home products and pet nutrition. Historically, the company has allocated capital well, and it produces significant free cash flows. Shares were pressured in Q4 primarily, we believe, in sympathy with near-term macroeconomic concerns rather than any fundamental issues at the business. We consequently capitalized on the underperformance and compelling valuation to start a position.”
1. The Procter & Gamble Company (NYSE:PG)
Number of Hedge Fund Holders: 79
The Procter & Gamble Company (NYSE:PG) provides branded consumer packaged goods to consumers across the globe. Its operations are divided into Fabric & Home Care, Grooming, Beauty, Health Care, Feminine & Family Care, and Baby. The company boasts a strong portfolio of brands, which includes reputable names such as Head & Shoulders, Pantene, Old Spice, Olay, Herbal Essences, Safeguard, Tide, Always, Venus, Oral-B, Ariel, Crest, Tampax, and others. The Procter & Gamble Company (NYSE:PG) sells its products in around 180 countries and territories.
In a report released on April 9, Dara Mohsenian from Morgan Stanley maintained a Buy rating on The Procter & Gamble Company (NYSE:PG) and set a price target of $191.00.
The Procter & Gamble Company (NYSE:PG) has a strong innovation pipeline and is leveraging AI and advanced technologies to optimize media buying, advertising development, and supply chain operations. The Wall Street Journal’s Natasha Khan and Sharon Terlep report showed that the company overtook Unilever by focusing on its largest brands and improving their efficacy. The Procter & Gamble Company (NYSE:PG) is in the strongest position to weather a turbulent year among its competitors, according to the report.
Overall, PG ranks first among the 12 best cosmetics stocks to buy for 2025. While we acknowledge the potential of cosmetics stocks, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than PG but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
Disclosure: None. Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily e-newsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below.
