Back to top

Image: Bigstock

Ulta Beauty (ULTA) Stock Sinks As Market Gains: Here's Why

Read MoreHide Full Article

Ulta Beauty (ULTA - Free Report) closed at $380.54 in the latest trading session, marking a -1.23% move from the prior day. This change lagged the S&P 500's 0.1% gain on the day. Meanwhile, the Dow gained 0.69%, and the Nasdaq, a tech-heavy index, added 0.06%.

Shares of the beauty products retailer have appreciated by 3.96% over the course of the past month, underperforming the Retail-Wholesale sector's gain of 5.33% and the S&P 500's gain of 4.37%.

The investment community will be paying close attention to the earnings performance of Ulta Beauty in its upcoming release. The company is slated to reveal its earnings on December 5, 2024. The company's earnings per share (EPS) are projected to be $4.45, reflecting a 12.23% decrease from the same quarter last year. Our most recent consensus estimate is calling for quarterly revenue of $2.48 billion, down 0.28% from the year-ago period.

For the full year, the Zacks Consensus Estimates project earnings of $23.07 per share and a revenue of $11.16 billion, demonstrating changes of -11.37% and -0.43%, respectively, from the preceding year.

Investors should also take note of any recent adjustments to analyst estimates for Ulta Beauty. These revisions typically reflect the latest short-term business trends, which can change frequently. Hence, positive alterations in estimates signify analyst optimism regarding the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the past month, there's been a 0.61% fall in the Zacks Consensus EPS estimate. At present, Ulta Beauty boasts a Zacks Rank of #3 (Hold).

In terms of valuation, Ulta Beauty is presently being traded at a Forward P/E ratio of 16.7. This denotes a premium relative to the industry's average Forward P/E of 13.57.

One should further note that ULTA currently holds a PEG ratio of 2.21. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. By the end of yesterday's trading, the Retail - Miscellaneous industry had an average PEG ratio of 2.21.

The Retail - Miscellaneous industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 144, which puts it in the bottom 43% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Ensure to harness Zacks.com to stay updated with all these stock-shifting metrics, among others, in the next trading sessions.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Ulta Beauty Inc. (ULTA) - free report >>

Published in