William Blair analyst Dylan Carden has maintained their neutral stance on ULTA stock, giving a Hold rating on August 19.
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Dylan Carden’s rating is based on a combination of factors that suggest a cautious outlook for Ulta Beauty. The company has shown improved demand trends, particularly in the online channel, which has been bolstered by a new platform and marketing strategies. However, there is a concern that this online growth could cannibalize the retail channel, potentially impacting margins as the year progresses and into 2026.
While Ulta Beauty benefits from easier comparisons and a return to growth after lapping incremental Sephora locations, there are uncertainties regarding the long-term success of Sephora’s presence in Kohl’s stores. Additionally, the termination of the Ulta Target partnership indicates a shift in focus back to core retail operations. Despite these dynamics, the beauty industry is stabilizing after significant post-COVID growth, and the company’s shares are valued at a level that reflects this maturity. As such, Carden maintains a Hold rating, acknowledging both the potential risks and the resilience of the beauty sector.
In another report released on August 19, Citi also maintained a Hold rating on the stock with a $550.00 price target.