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Valued at a market cap of $17.7 billion, Ulta Beauty, Inc. (ULTA) is a leading beauty retailer in the United States, offering a wide range of cosmetics, skincare, haircare, and fragrance products. The company operates a unique business model that combines a vast product selection with in-store salons, enhancing the shopping experience. With a strong e-commerce presence complementing its brick-and-mortar stores, Ulta has positioned itself as a dominant player in the beauty industry.
Shares of ULTA have underperformed the broader market over the past 52 weeks. ULTA has declined 33.8% over this time frame, while the broader S&P 500 Index ($SPX) has gained 17.6%. In 2025, shares of ULTA are down 16.3%, compared to SPX’s 25.8% increase on a YTD basis.
Narrowing the focus, ULTA has also lagged behind the Consumer Discretionary Select Sector SPDR Fund’s (XLY) 20% rise over the past 52 weeks and down 3% return on a YTD basis.
On Dec. 5, Ulta Beauty shares surged 9% following its Q3 earnings release, as the company delivered stronger-than-expected results. It reported a profit of $5.14 per share and revenue of $2.5 billion, reflecting year-over-year growth of 1.4% and 1.7%, respectively. The growth was largely fueled by new store openings, with Ulta adding 28 locations, remodeling 27, and closing two during the quarter
Building on this momentum, ULTA raised its full-year 2024 EPS guidance to $23.20-$23.75, reinforcing investor confidence. The company now expects fiscal 2024 net sales between $11.1 billion and $11.2 billion, with comparable sales projected to range from 0% to a 1% decline.
For the current fiscal year, ending in January 2025, analysts expect ULTA’s EPS to decline 8% year-over-year to $23.96. The company’s earnings surprise history is mixed. It beat the consensus estimates in three of the last four quarters while missing on another occasion.
Among the 28 analysts covering the stock, the consensus rating is a “Moderate Buy.” That’s based on 12 “Strong Buy” ratings, two “Moderate Buy,” 13 “Holds,” and one “Strong Sells.”
This configuration has been relatively stable over the past couple of months.
On Jan. 21, Morgan Stanley (MS) analyst Simeon Gutman upgraded Ulta Beauty to “Overweight” from “Equal-Weight,” raising the price target to $500 from $430. He expects the beauty industry to sustain above-average growth in 2025 and anticipates Ulta’s market share to improve from its 2024 low. The firm views the company’s sales and margin forecasts as reasonable, seeing potential for earnings and valuation upside.
The mean price target of $464.32 represents a premium of only 27.6% to ULTA’s current levels. The Street-high price target of $538 implies a potential upside of 47.8% from the current price.
On the date of publication, Kritika Sarmah did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
