Ulta Beauty(US:ULTA) ZACKS·2025-12-09 15:30Core Viewpoint - The article discusses the reliability of brokerage recommendations, particularly focusing on Ulta Beauty (ULTA), and emphasizes the importance of using these recommendations in conjunction with other analytical tools like the Zacks Rank to make informed investment decisions [1][5][11]. Group 1: Brokerage Recommendations - Ulta currently has an average brokerage recommendation (ABR) of 1.94, indicating a position between Strong Buy and Buy, based on recommendations from 25 brokerage firms [2]. - Of the 25 recommendations, 13 are Strong Buy and 2 are Buy, which account for 52% and 8% of all recommendations, respectively [2]. - Despite the positive ABR, the article cautions against making investment decisions solely based on this metric due to the tendency of brokerage analysts to exhibit a strong positive bias in their ratings [5][6]. Group 2: Zacks Rank - The Zacks Rank categorizes stocks into five groups, from Zacks Rank 1 (Strong Buy) to Zacks Rank 5 (Strong Sell), and is based on earnings estimate revisions, which have shown a strong correlation with near-term stock price movements [8][12]. - The Zacks Consensus Estimate for Ulta has increased by 4.8% over the past month to $25.31, reflecting analysts' growing optimism about the company's earnings prospects [14]. - Ulta has received a Zacks Rank 2 (Buy), indicating a favorable outlook based on the recent changes in earnings estimates and other related factors [15].