Ulta Beauty Posts Q4 Beat, Brushes Off Disappointing Outlook

Core Insights - Ulta Beauty Inc reported strong fourth-quarter earnings, with earnings per share at $8.46, surpassing the consensus estimate of$7.10, and revenue at $3.49 billion, exceeding the projected$3.46 billion [1][2] Group 1: Earnings Performance - The company posted earnings of $8.46 per share, significantly above the expected$7.10 [1] - Revenue for the quarter was $3.49 billion, which also exceeded the forecast of$3.46 billion [1] Group 2: Future Guidance - Ulta issued weaker-than-expected full-year guidance, anticipating comparable sales to be flat or increase by just 1% in 2025, below analyst expectations of 1.2% growth [2] - The company forecasted lower-than-expected profits for the upcoming year, focusing on restructuring and long-term growth investments [2] Group 3: Stock Performance - Following the earnings report, Ulta's stock rose by 7.2% to $337, recovering from a pre-earnings drop to$328.45, its lowest since May 2021 [3] - Year-to-date, the stock has reduced its deficit to 23%, but remains down over 40% in the last 12 months [3] Group 4: Analyst Reactions - At least 12 analysts lowered their price targets post-earnings, with Wells Fargo adjusting its target from $360 to$310, representing an 8% discount to the current stock price [4] - The consensus 12-month average price target stands at $424.88, indicating a 27.2% premium to Ulta's current trading level, suggesting potential for further price-target reductions [4] Group 5: Options Activity - Options trading activity has increased significantly, with 6,782 calls and 6,363 puts exchanged, which is seven times the typical volume [5] - The most active options contract is the weekly 3/14 350-strike call, indicating new positions being opened [5]