Despite a secondary offering, shares of e.l.f. Beauty (ELF) - Get Report are up almost 3% Friday.

Usually a secondary offering weighs on a stock's price, as more supply is added to the mix. But e.l.f. is trading higher because there is such "tremendous demand," TheStreet's Jim Cramer, manager of the Action Alerts PLUS portfolio, explained on CNBC's "Stop Trading" segment. 

The most recent quarter was a blowout and management continues to do such an excellent job, Cramer reasoned. At current prices, e.l.f. may actually be a better pick than Ulta Beauty (ULTA) - Get Report , he added. 

These companies are thriving in what Cramer refers to as the "selfie generation," where people can't go out without make-up because so many photos and selfies are taken each day. 

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People need to look there best and companies like e.l.f. and Ulta cater to that market. The fact that e.l.f. is an affordable alternative for consumers makes it that much more attractive, he concluded. 

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At the time of publication, Cramer's Action Alerts PLUS had no position in companies mentioned.