Ulta Beauty (ULTA) stock is trading lower Friday after the beauty retailer fell short of top- and bottom-line expectations for its second quarter and cut its full-year outlook.
In the 13 weeks ended August 3, Ulta's revenue increased 0.9% year-over-year to $2.55 billion, with top-line growth pressured by a 1.2% slump in comparable-store sales. Its earnings per share (EPS) declined 12% from the year-ago period to $5.30.
"While we are encouraged by many positive indicators across our business, our second-quarter performance did not meet our expectations, driven primarily by a decline in comparable -tore sales," said Ulta CEO Dave Kimbell in a statement. "We are clear about the factors that adversely impacted our store performance, and we have actions underway to address the trends."
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.
The results fell short of analysts' expectations. Wall Street was anticipating revenue of $2.6 billion and earnings of $5.46 per share, according to Yahoo Finance.
"In light of our first-half trends and a more cautious outlook, we have updated our full-year expectations," Kimbell said. Here's what the company now expects to accomplish in its fiscal year versus its previous forecast:
| Metric | New outlook | Previous outlook |
|---|---|---|
| Revenue | $11 billion to $11.2 billion | $11.5 billion to $11.6 billion |
| Comparable-store sales | (2%) to 0% | 2% to 3% |
| Earnings per share | $22.60 to $23.50 | $25.20 to $26 |
Analysts were forecasting revenue of $11.5 billion and earnings of $25.23 per share for Ulta in 2024.
Is Ulta stock a buy, sell or hold?
It's been a rough year on the price charts for Ulta Beauty. While shares got a short-lived boost earlier this month on news Ulta was added to Warren Buffett's Berkshire Hathaway equity portfolio in Q2, they remain more than 27% lower for the year to date. Still, Wall Street remains bullish on the consumer discretionary stock.
According to S&P Global Market Intelligence, the consensus analyst target price for ULTA stock is $413.55, representing implied upside of roughly 16% to current levels. Meanwhile, the consensus recommendation is a Buy.
Financial services firm Oppenheimer has an Outperform rating (equivalent to a Buy) on ULTA stock with a $435 price target.
"We continue to look favorably on ULTA's long-term prospects," says Oppenheimer analyst Rupesh Parikh, citing the company's differentiated offerings, potential to deliver above-average growth rates in retail, and strong management as some of the reasons he is bullish.
"We continue to view ULTA shares as appropriate for longer-term players and would take advantage of any dips from here," Parikh adds.
Related Content
-
Your Estate Plan Isn't Complete Until You've Done These StepsCongratulations on getting your estate plan in order. Now, you need to communicate the relevant details to ensure your plan is effectively carried out.
-
A Nightmare for Parents: Navigating Tenant Rights in a CrisisThis family's story illustrates how important it is to get help sooner rather than later and highlights the complexities of tenant rights and legal protections.
-
Your Estate Plan Isn't 'Done' Until You've Completed These Five Steps, From an Estate Planning Attorney
Congratulations on getting your estate plan in order. Now, you need to communicate the relevant details to ensure your plan is effectively carried out.
-
A Nightmare for Parents: How to Navigate the Legal Boundaries of Tenant Rights During a Family Crisis
This family's story illustrates how important it is to get help sooner rather than later and highlights the complexities of tenant rights and legal protections.
-
Amazon Surge Sends S&P 500, Nasdaq Higher to Start November: Stock Market TodayAmazon inked a $38 billion cloud deal with OpenAI, which sent the stock to the top of the Dow Jones on Monday.
-
If You'd Put $1,000 Into Home Depot Stock 20 Years Ago, Here's What You'd Have TodayHome Depot stock has been a buy-and-hold banger for truly long-term investors.
-
Eight Steps to Help Get You Through the Open Enrollment Jungle at WorkWondering how to survive open enrollment this year? Arm yourself with these tools to cut through the process and get the best workplace benefits for you.
-
Seven Moves for High-Net-Worth People to Make Before End of 2025, From a Financial PlannerIt's time to focus on how they can potentially reduce their taxes, align their finances with family goals and build their financial confidence for the new year.
-
I'm a Financial Planner: These Are the Seven Tiers of Retirement Well-BeingLet's apply Maslow's hierarchy of needs to financial planning to create a guide for ranking financial priorities.
-
Why More Americans Are Redefining Retirement, Just Like I DidRetirement readiness requires more than just money. You have a lot of decisions to make about what kind of life you want to live and how to make it happen.
