E.l.f. Beauty Inc (ELF) called a short-seller’s report meritless a day after its publisher, Muddy Waters Research, accused the cosmetics company of overstating its revenue.

Muddy Waters in its report alleged that e.l.f. exaggerated its revenue by as much as $190 million over the past three quarters. The write-up claimed e.l.f.—which imports most of its products—reported rising revenues and inventory levels at the same time as it was importing far fewer products.

"To sell something, you have to actually have it," Muddy Waters CIO Carson Block told CNBC.

E.l.f.’s stock price rose Thursday after the company issued a statement saying that Muddy Waters’ claims had no merit and that it was "fully confident in our financial statements." The shares were recently up about 4%, shaking off lows seen intraday Wednesday.

The beauty brand said it asked U.S. Customs and Border Protection to keep its import data confidential in early 2024, meaning Muddy Waters assessed data that “does not include a substantial majority of our actual U.S. imports.”

“Muddy Waters has made numerous inaccurate statements about e.l.f. Beauty and our business by relying upon incomplete data and flawed assumptions, omitting critical context, and presenting speculation as fact," the cosmetics company said in its statement.

E.l.f. shares remain down about 14% this year.