Ulta Beauty upgraded to Buy from Hold at Jefferies

Jefferies upgraded Ulta Beauty (ULTA) to Buy from Hold with a price target of $700, up from $635. The firm has improved confidence in the company’s revenue durability citing a “broadening beauty backdrop and renewed makeup engagement.” Improved brand newness and merchandise execution better position Ulta to capitalize on the cycle, while spending expectations have been reset to a more realistic framework, the analyst tells investors in a research note. Jefferies sees a favorable risk/reward at current share levels, saying the stock reflects investor skepticism and modest margin expansion.