Ulta Beauty Inc

ULTA: XNAS (USA)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
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Ulta Beauty Earnings: Sales and Margins Looking Better After Lowered Expectations; Shares Pricey

David Swartz

Dec 6, 2024

After offering disappointing guidance in August and at its analyst event in October, narrow-moat Ulta Beauty posted third-quarter results above our forecast. Although its comparable sales growth was muted (0.6%), it bettered our estimate of a 2% decline and the prior quarter’s 1.2% drop. Even so, competition from Sephora and others remains fierce, and expectations are not particularly high for either this holiday season or 2025. We expect to lift our $360 fair value estimate by a low-single-digit percentage but regard Ulta’s shares, up 12% in after-hours trading on Dec. 5, as overpriced.

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Ulta Beauty Inc

Ulta Beauty Earnings: Sales and Margins Looking Better After Lowered Expectations; Shares Pricey

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