Core Viewpoint - Ulta Beauty is facing a challenging financial outlook with expected declines in earnings and revenue for the upcoming earnings report on December 5, 2024, which may impact investor sentiment [2][3]. Financial Performance - The stock closed at $360.47, reflecting a -0.6% change from the previous day, underperforming the S&P 500's gain of 0.57% [1]. - Over the past month, Ulta Beauty shares have decreased by 4.59%, contrasting with the Retail-Wholesale sector's gain of 6.19% and the S&P 500's gain of 3.15% [1]. Earnings Estimates - Analysts project earnings of $4.45 per share for the upcoming quarter, indicating a year-over-year decline of 12.23% [2]. - For the full year, earnings are estimated at $23.07 per share, down 11.37% from the previous year, with revenue expected to be $11.16 billion, a decrease of 0.43% [3]. Analyst Sentiment - Recent changes in analyst estimates are crucial as they reflect the evolving business landscape, with positive revisions seen as a favorable sign for the company's outlook [3][4]. - The Zacks Rank system, which evaluates these estimate changes, currently rates Ulta Beauty as 3 (Hold) [5]. Valuation Metrics - Ulta Beauty has a Forward P/E ratio of 15.72, which is higher than the industry average of 13.09, indicating a premium valuation [6]. - The company also has a PEG ratio of 2.08, aligning with the industry average, suggesting that growth expectations are factored into its valuation [7]. Industry Context - The Retail - Miscellaneous industry, to which Ulta Beauty belongs, has a Zacks Industry Rank of 163, placing it in the bottom 36% of over 250 industries, indicating weaker performance relative to other sectors [7][8].

Core Viewpoint - Berkshire Hathaway sold over 95% of its stake in Ulta Beauty shortly after acquiring it, raising questions about the company's future prospects and investment potential [1][2]. Company Performance - Ulta Beauty has faced challenges with slowing sales growth due to weakened consumer spending and increased competition, leading to a decline in comparable store sales of 1.2% and a modest overall revenue increase of 1% to $2.55 billion in the second quarter [5][6]. - The company's gross margin decreased from 39.3% to 38.3%, while selling, general, and administrative expenses rose from $600.7 million to $644.8 million, resulting in a drop in operating margin from 15.5% to 12.9% and a decline in earnings per share (EPS) from $6.02 to $5.30 [6]. Industry Context - The beauty retail industry is expected to return to low to mid-single-digit growth rates, similar to trends observed during the 2010s, following a pandemic-related boom [5]. - Ulta's stock currently trades at a price-to-earnings ratio of less than 15, which is considered attractive given its historical performance of over 1,100% return since its IPO in 2007 [4]. Strategic Outlook - Ulta has set long-term targets to grow from over 1,400 stores to more than 1,800 and aims to increase its loyalty membership from 43.9 million to 50 million by 2028 [7][8]. - The company has outlined financial targets for 2026 and beyond, including 4% to 6% revenue growth and low-double-digit EPS growth, focusing on enhancing product assortment, customer experience, and loyalty engagement [8]. Competitive Advantages - Despite recent struggles, Ulta maintains competitive advantages such as large retail stores, in-store salons, a robust loyalty program with over 40 million members, and 800 locations within Target stores [9]. - The current valuation is seen as attractive, especially if Ulta can achieve its intended double-digit EPS growth [10].

Ulta Beauty (NASDAQ: ULTA ) stock has fallen 22% year-to-date while the market has soared. Investors are likely disappointed by the lack of growth recently and the fact that 2024 and 2025 will be transitional years for the company.I objectively search for undervalued stocks of any size across a wide variety of industries using quantitative methods that I've thoroughly backtested for success. I believe the numbers are more important than the story (most of the time), as they tend to paint a more realistic pi ...

BofA Securities analyst Lorraine Hutchinson reiterated the Neutral rating on Ulta Beauty, Inc. ULTA with a price objective of $380. The analyst reduced the FY25 EPS estimate by 8% to $22.41, reflecting a 3% decline due to more store openings offset by lower margins. The company projects annual sales growth of 4-6%, comparable sales growth of 3-4%, and low-double-digit EPS growth. Per Hutchinson, FY25 may be a transitional year, with results falling short of long-term targets as the company navigates softer ...

Ulta Beauty, Inc. (ULTA) , a prominent player in the beauty space is trading at a discount compared to the Zacks Retail - Miscellaneous industry. With a forward 12-month Price/Earnings (P/E) ratio of 15.3X, ULTA is trading below the industry average of 16.8X and the broader Retail and Wholesale sector's 24X. It also trades lower than the S&P 500's multiple of 22.1X. However, investors should carefully evaluate whether this discounted valuation signifies a genuine buying opportunity or if it could be a poten ...

Staying committed to strengthening its position in the beauty industry, Ulta Beauty, Inc. (ULTA) has announced an ambitious strategic plan and new long-term financial targets. With more than 30 years of innovation and leadership in the sector, the company is preparing to capitalize on its proven business model and financial strength to push its next phase of expansion. The newly announced strategic priorities are aimed at enhancing Ulta Beauty's distinctive model and driving innovation to meet the changing ...

Ulta Beauty announced on Wednesday that it plans to open 200 new stores over a three-year period as part of the company's strategic growth plan. The beauty retailer said Wednesday that it will step up the pace of its openings, targeting a 1,800-plus store footprint "over the long-term." Ulta currently has more than 1,400 retail stores nationwide. It also has several hundred Ulta Beauty at Target locations. The company unveiled its expansion plans in the morning, before the start of its investor day on Wedne ...

Core Insights - Ulta Beauty is facing "headwinds" and increased competition in the beauty industry, leading to a decline in share prices [1] - The company maintains its fiscal year forecast, expecting net sales between $11 billion and $11.2 billion, with comparable sales projected to decline by 2% to remain roughly flat [2] - For 2026 and beyond, Ulta targets 4% to 6% net sales growth and low double-digit diluted earnings per share growth, with operating profit growth in the mid single digits and operating margins around 12% of net sales [3] Company Strategy - CEO Dave Kimbell acknowledged that the current year has been more challenging than anticipated, citing normalization in the beauty category and increased competition, particularly in the prestige segment [4] - The company plans to enhance sales through partnerships with new brands, expanding its loyalty program, and personalizing promotions to better engage customers [4][5] - Despite anticipated near-term challenges, the company expresses confidence in its long-term growth strategy [5]

Ulta Beauty (ULTA) has recently been on Zacks.com's list of the most searched stocks. Therefore, you might want to consider some of the key factors that could influence the stock's performance in the near future. Shares of this beauty products retailer have returned +9.7% over the past month versus the Zacks S&P 500 composite's +1.7% change. The Zacks Retail - Miscellaneous industry, to which Ulta belongs, has gained 0.2% over this period. Now the key question is: Where could the stock be headed in the near ...

SEOUL, SOUTH KOREA - August 07: Singer and actress IU attends ESTEE LAUDER pop-up store opening ... [+] event at Lotte Avenel Jamsil in Songpa-gu on August 07, 2024 in Seoul, South Korea. (Photo by iMBC/Imazins via Getty Images) ImaZins via Getty Images Estée Lauder stock (NYSE: EL) has had a tough year so far, with its stock falling 40%, while its peer Ulta Beauty stock (NASDAQ: ULTA) has seen a 16% decline. Estée Lauder has been struggling with falling sales and profits lately, but that appears to be pric ...