Our financial investment master Anne Ashworth makes YOU cash by scouring the stock market for the very best funds and shares. She exposes how you can cash in on cosmetics ...

Looking good can be pricey. Lotions, potions, make-up and creams: they are all pricey. But for financiers, they can likewise be highly lucrative.

The target of one of this summer's most talked-about takeover deals is a cosmetics company developed simply three years back by an American model who's married to a pop idol.

This company's products, a huge success among Gen Z, consist of a 'glazed-doughnut effect' lip treatment.

The $6.41 bn e.l.f. Beauty group, commemorated for its discount 'dupe' - or copycat - creams and comprise, is paying $1bn in shares and money for Rhode, a charm company whose sales in the year to March were $212m.

Rhode is led by Hailey Rhode Bieber, a business owner and influencer with 55.1 m Instagram fans, an important in a market being disrupted by social media. She is the other half of vocalist Justin and child of star Stephen Baldwin, bro of Alec.

The excitement around the deal suggests that, if your portfolio requires a glow-up, maybe you need to aim to the worldwide appeal business, whose sales are forecast to reach $600bn by 2028.

Rhode, a beauty business owned by design Hailey Bieber, is being acquired by e.l.f. Beauty (listed below) for $1bn

New research from Barclays shows that the 'lipstick index', still applies.

Under this theory, in hard times females will continue to treat themselves to a little indulgence such as a lipstick - or nowadays, a peptide lip treatment.

Gerrit Smit of fund manager Stonehage Fleming believes the human desire to look better will constantly be with us - and therefore guarantees returns for investors.

'Beauty is a sector with indefinite sustainable development, as the desire for charm is a permanently aspect. Everyone is growing older and wish to look excellent doing so.'

Smit highlights the sector's development, with its concentrate on developing creams and cosmetics for various markets, ranging from 'tweens', the 13-year-olds with intricate skin cleaning programs, to older females combating the effects of aging.

Such was the enjoyment about Rhode's possible to interest all ages that there was a 24pc bounce in it shares.

The purchase of Rhode will also enable e.l.f. (the name stands for eyes, lips, face) to diversify its supply chain. The business, that makes 75pc of its ranges in China, is presently based on 30pc tariffs in the US, and has already been required to raise rates.

News of the Rhode acquisition was accompanied by the statement of 28pc boost in e.l.f.'s sales for 2025 to $1.3 bn. This seems like an impressive increase. But sales leapt by 77pc in 2024.

Ms Bieber and e.l.f. Beauty chairman and CEO Tarang Amin

The slower development highlights the market's numerous difficulties - such as Chinese consumers' unwillingness to invest.

This disinclination to splash the money has struck the shares of the charm power homes: Coty, Estee Lauder, L'Oreal, Shiseido and Puig, the Spanish owner of Charlotte Tilbury.

Estee Lauder shares reached $365 in December 2021. They are now back down at $68, partly due to management and other concerns - but also since 26pc of its incomes originate from China.

Other forces are likewise bringing change, as Will McIntosh Whyte, fund manager at Rathbones, mentions: 'Brand loyalty is on the decrease, because social media makes it possible for start-up brand names to reach big audiences and grow quickly.'

But e.l.f.'s relocate to purchase Rhode might indicate confidence is returning and there is a chance for financiers to profit.

A minimum of one prominent and hard-headed US financier appears encouraged this the case.

Michael Burry, the hedge fund manager whose bet in 2008 on mortgage-backed securities was depicted in the movie The Big Short, is backing revival at Estee Lauder.

His Scion Asset Management fund now holds a $13.3 m stake in Estee Lauder, owner of brands like Bobbi Brown, Clinique, Jo Malone London and Le Labo.

Who knows if Burry is a regular user of Estee Lauder Advanced Night Repair Serum? But there can be some advantage to devoting some of your financial investment budget plan to the companies that make the important things you like. This familiarity provides you extra insight. Here are your choices.

THE BEAUTY PARADE

Among L'Oreal brands are CeraVe, Garnier, Maybelline and the more upmarket Aesop and Lancome

L'Oreal, a EUR200bn Paris-based organization, is the titan of the market. The starting household, the Bettencourt Meyers dynasty, have a 35pc stake.

Among L'Oreal brands are CeraVe, Garnier, Maybelline and the more upmarket Aesop and Lancome. Demand for these costly lines assisted first-quarter sales to rise by 3.5 pc to EUR11.73 bn.

Smit lists L'Oreal's strengths. 'Its success is based on extreme research study: it spends about EUR1bn a year. Its gross earnings margins can be as high as 70pc on some items; it also has pricing power.'

Smit also likes the business's motto: 'We do just beauty however all of beauty.'

McIntosh Whyte concerns L'Oreal as 'the quality play' in the sector because of its early recognition of social networks's significance.

He adds: 'L'Oreal is skilled at getting brand names popular with younger customers such as the skincare brands Dr G and Youth To The People. The business utilizes its scale to turn these brands from specific niche gamers into worldwide names.'

L'Oreal shares have actually increased by 15pc over the past 6 months to EUR384. Estee Lauder shares started to surge a month back, stimulated by hopes that the $20bn group can stage a turnaround. For the moment, analysts rate the shares a hold.

E.l.f., by contrast, is rated a 'buy', although the shares are 564pc above their level of 5 years ago. The view seems to be that, although other star beauty brands are for sale, Rhode is the most promising.

Investment expert (and cosmetics fan) Anne Ashworth says she'll be investing - on the basis that it can pay to put your cash where your mouth is

E.l.f. does not appear dissuaded by the so-so experience of Coty's financial investment in 2 Kardashian brand names. Coty keeps a 51pc slice of Kylie Beauty, the Kylie Jenner brand, but her sibling Kim Kardashian has purchased back her company.

Coty shares are 81pc lower than a years back, and 34pc down over the past six months at $5. But experts appear to reckon that Coty needs to gain from the upturn in the sector and recommend that the shares deserve holding.

Most experts also think about shares in Ulta Beauty to be a 'hold', although this chain of American appeal shops and salons reported better-than-expected very first quarter sales late last month, causing an 18pc bounce in the shares to $467.

Ulta's president Kecia Steelman, summarized the mood that is stimulating the recovery: 'Many customers show that they are leaning into beauty as a convenience and escape from the tension of macro unpredictability.'

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Shares in Shiseido, the Japanese group, are 65pc down over 5 years at 2,441 yen. Nevertheless, experts consider Shiseido to be a 'hold' obviously hoping the business is addressing problems such as poor efficiency of its whimsical Drunk Elephant skin care brand name.

For a while, Drunk Elephant was a favourite amongst teenagers. But these are fickle customers, and there was some debate as to whether this age needs potions to take on wrinkles. The London activist financier Independent Franchise Partners has a holding in Shiseido which need to add to press for change.

More optimism surrounds the Spanish group Puig which is viewed as 'buy' on the basis of more need for its Paco Rabanne and other fragrances. The shares stand at EUR17.

One analyst predicts a rise to EUR30 - which would be great news for Charlotte Tilbury, the creator of the eponymous brand. She maintains a minority shareholding in her development till Puig assumes full ownership in 2031.

A tube of Charlotte Tilbury's bestselling Pillow Talk lipstick expenses ₤ 29. A tube of W7 Naked Desire lipstick (in a comparable gold-fluted housing) is ₤ 4.

On the basis that many will prefer an inexpensive treat, shares in the W7 business - the ₤ 388m Warpaint London - look appealing buy at 455p. Analysts have set an average target cost of 666p.

As an unashamed lover of creams, make-up and perfume - I have drawers full of the stuff - I am going to take a bet on a spread of beauty stocks.

I will be spending for the basis that it can pay to put your money where your mouth is. Or should that be what you place on your eyes, your lips and your face?