Ulta (ULTA) stock slipped in early trading Friday after the beauty store retailer cut its full-year outlook despite reporting better-than-expected first-quarter results.
For the three months ended May 4, Ulta’s net sales increased 3.5% year-over-year to $2.7 billion, driven by a 1.6% increase in comparable-store sales and 10 net new store openings. Its earnings per share (EPS) decreased 6% to $6.47 from the year-ago period.
"The Ulta Beauty team delivered net sales growth of 3.5% and comparable sales growth of 1.6% in a dynamic operating environment," Ulta CEO Dave Kimbell said in a statement. "We have a clear plan to accelerate our momentum and continue delivering a best-in-class assortment and engaging experiences for our guests."
From just $107.88 $24.99 for Kiplinger Personal Finance
Be a smarter, better informed investor.
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Ulta's bottom line beat analysts’ expectations, as Wall Street was anticipating earnings of $6.24 per share, according to data from Refinitiv. Sales of $2.7 billion matched estimates.
Despite the strong start to the year, decelerating comparable-store sales contributed to Ulta cutting its full-year outlook. Here’s what the company now expects compared to its previous guidance:
| Metric | New Outlook | Previous Outlook |
|---|---|---|
| Net Sales | $11.5 billion to $11.6 billion | $11.7 billion to $11.8 billion |
| Comparable-Store Sales | 2% to 3% | 4% to 5% |
| EPS | $25.20 to $26 | $26.20 to $27 |
"I remain confident in our differentiated model, the resilience of the beauty category, and our ability to execute against our plans, but we have adjusted our annual guidance as we anticipate the dynamics we faced in the first quarter to continue for the balance of the year," Kimbell said.
Is Ulta stock a buy, sell or hold?
Analysts remain bullish on the beauty retailer. According to S&P Global Market Intelligence, the average analyst target price for ULTA stock is $498.10. That gives shares implied upside of more than 29% to current levels. Meanwhile, the consensus recommendation is a Buy.
Financial services firm UBS is one of the most bullish firms on Ulta stock with a Buy rating and $550 price target.
"We think a key takeaway is that ULTA set more realistic expectations for 2024," UBS said in a note to clients. "This was a learning event. There's nothing fundamentally wrong with ULTA's model.”
The $550 price target represents implied upside of over 42% to current levels.
Related Content
-
These Stocks Dipped in 2025. Do They Have Value?If you are looking to add new long-term positions to your portfolio, as you should, this is the time to examine stocks that the market shuns.
-
Striking Gold (or Gas): A Financial Pro Unpacks the Nuances of Energy InvestingInvesting in the energy industry, particularly oil and gas, involves understanding the facts about how projects generate returns through cash flow and long-term asset building, while also being aware of the risks.
-
These Stocks Dipped in 2025. Do They Have Value?
If you are looking to add new long-term positions to your portfolio, as you should, this is the time to examine stocks that the market shuns.
-
Striking Gold (or Gas): A Financial Pro Unpacks the Nuances of Energy Investing
Investing in the energy industry, particularly oil and gas, involves understanding the facts about how projects generate returns through cash flow and long-term asset building, while also being aware of the risks.
-
Escaping the New Golden Handcuffs: A Financial Expert Has a Plan for Today's ExecutivesFeeling stuck in your job? It could be your complicated compensation package, but it also could be where you live, your family or even how you view yourself.
-
Stock Market Winners and Losers of the 'Big, Beautiful' BillDefense, manufacturing and tech should prosper, while health care and green energy stocks face hurdles.
-
I'm a Financial Planner: Here's How to Invest Like the Wealthy, Even if You Don't Have MillionsPrivate market investments, once exclusive to the ultra-wealthy and institutions, have become more accessible to individual investors, thanks to regulatory changes and new investment structures.
-
Four Ways a Massive Emergency Fund Can Hurt You More Than It HelpsSaving too much could mean you're missing opportunities to put your money to work. Redirect some of that money toward paying off debt, building retirement funds, fulfilling a dream or investing in higher-growth options.
-
With Buffett Retiring, Should You Invest in a Berkshire Copycat?Warren Buffett will step down at the end of this year. Should you explore one of a handful of Berkshire Hathaway clones or copycat funds?
-
I'm a Financial Planner: How to Dodge a Retirement Danger You May Not Have Heard AboutTiming is everything, and sequence of returns risk can mean the difference between a retirement nest egg that's overflowing … or empty.
