NASDAQ:ULTA
Ulta Salon Cosmetics and Fragrance Inc. (ULTA)
Financials 
Technical Analysis 
Jul 31, 2026, 12:00 amThis summary was created by AI, based on 4 opinions in the last 12 months.
Ulta Salon Cosmetics and Fragrance Inc. (ULTA-Q) is experiencing a mix of strong growth and recent challenges. Although they reported impressive year-over-year sales increases and raised their forecasts, concerns linger about a potential slowdown in the latter half of 2026 and the impact of higher-than-expected costs on earnings, which led to a 23% decline in stock value over the past month. Despite this pullback, there's optimism as younger generations show a strong affinity for beauty products, making the brand less likely to be disrupted by AI advancements. Under the leadership of new CEO Steelman, the company has seen a remarkable 54.4% increase in stock value over the past year, highlighting significant investor confidence and positive market sentiment toward consumer stocks, especially as interest rates are poised for cuts in December.
They just reported an excellent quarter last night, but spiked after hours, plunged, then rebounded today. A yo-yo. Why? How? Up and down then flat. They had a massive earnings and sales beats. Same-store sales were up 15.6% vs. 8.7% expected. And they faced tough comps from last year. RPS and revenue forecast FY 2023 guidance topped expectations. They're opening 25-30 new stores, while Wall Street expected 49. Problem is that expectations were set high, and today saw the SVB crash and a bearish market. Impressive growth areas: skin care, fragrance and ecommerce/in-store pick-up. Rewards program boasts 40.2 million members. American luxury spending will remain healthy, but will moderate. Not perfect, but pretty good.
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Premium contentEstee Lauder is a consideration, but it trades at 44.9x PE and the stock locks fully valued now. In contast, Ulta looks reasonable at a 26.4x valuation. True, Ulta is also trading at current highs, but it could have a little more upside. The 14 analysts who recommend a buy and the seven who hold agree by placing a $460.37 price target on ULTA-Q. That's nearly 14% upside as the year starts. Also, Ulta boasts a strong record of four blow-out beats last year. Consumers hold a lot of cash and, after being cooped up during Covid, are dying to get out and meet people again. This is the way to play the coming party.
(A Top Pick Sep 02/20, Up 52%) People are buying makeup and perfumes again. They did well with skincare and their deal with Target during the pandemic. Beauty and cosmetics are coming back. They will perform quite well if things stay open.
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They had a great quarter and he loves the CEO. At $438, shares are in no-man's land. Sells at 17x earnings. A good buy, but not a trading stock.