Ulta Beauty (ULTA) AI Stock Analysis

• Market Cap: $16.46B
• Dividend Yield: N/A
• Average Volume (3M): 1.23M
• Price to Earnings (P/E): 14.3
• Beta (1Y): 0.62
• Revenue Growth: 0.79%
• EPS Growth: -2.70%
• Country: US
• Employees: 20,000
• Sector: Consumer Cyclical
• Sector Strength: 55
• Industry: Specialty Retail
• EPS (TTM): 25.37
• Shares Outstanding: 45,309,486
• 10 Day Avg. Volume: 1,156,268
• 30 Day Avg. Volume: 1,229,448
• PEG Ratio: 9.61
• Price to Book (P/B): N/A
• Price to Sales (P/S): 1.43
• Price to Cash Flow (P/CF): -71.50
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $416.05
• Price Target Upside: 14.55% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 23

Ulta Beauty scores well overall, driven by strong financial performance and a reasonably attractive valuation. While technical indicators suggest mixed signals, strategic challenges outlined in the earnings call and the proactive CEO transition offer a balanced outlook. The company is strategically positioned for growth, but it faces short-term pressures that investors should monitor.

Positive Factors

Brand and Product Expansion

Ulta Beauty plans to reinvigorate the brand and sales growth with newness, innovation, and the introduction of Beyoncé’s hair care brand in 1,400 stores.

Data and Customer Insights

A better data platform allows Ulta Beauty to expand its reach and enhance targeting through improved customer insights.

Negative Factors

Cost Pressures

Store payroll and benefits primarily drove SG&A deleverage, with annual wage analysis suggesting that state minimum wage increases should drive a lift to aggregate pay increase.

Gross Margin Pressure

Merchandise margin deleverage is contributing to a decline in gross margin.

Ulta Beauty Business Overview & Revenue Model

Company Description

Ulta Beauty, Inc. operates as a retailer of beauty products in the United States. The company's stores offer cosmetics, fragrances, skincare and haircare products, bath and body products, and salon styling tools; professional hair products; salon services, including hair, skin, makeup, and brow services; and nail services. It also provides its private label products, such as the Ulta Beauty Collection branded cosmetics, skincare, and bath products, as well as Ulta Beauty branded products; and the Ulta Beauty branded gifts. As of March 10, 2022, the company operated 1,308 retail stores across 50 states. It also distributes its products through its website ulta.com; and mobile applications. The company was formerly known as Ulta Salon, Cosmetics & Fragrance, Inc. and changed its name to Ulta Beauty, Inc. in January 2017. Ulta Beauty, Inc. was incorporated in 1990 and is based in Bolingbrook, Illinois.

How the Company Makes Money

Ulta Beauty generates revenue primarily through the sale of beauty products in its retail stores and online platform. The company's revenue streams include product sales from cosmetics, skincare, haircare, and fragrance products, as well as services provided through its in-store salons. Ulta Beauty also benefits from its Ultamate Rewards loyalty program, which drives repeat purchases and enhances customer retention. The company's partnerships with leading and niche beauty brands bolster its product offerings, allowing it to attract a diverse customer base. Additionally, Ulta Beauty's strategic store locations, marketing initiatives, and e-commerce capabilities contribute to its revenue growth.

Ulta Beauty Financial Statement Overview

Summary

Ulta Beauty demonstrates strong financial health characterized by consistent revenue and profit growth, efficient operations, and robust cash flow generation. The company maintains a balanced capital structure, though a moderate level of debt highlights the importance of sustaining profitability and cash flow to mitigate any potential risks. Overall, Ulta Beauty is well-positioned for continued success in the specialty retail industry.

Income Statement

Ulta Beauty has shown a strong financial performance with consistent growth in revenue and profitability. The TTM gross profit margin stands at approximately 38.83%, indicating efficient cost management. The net profit margin for TTM is about 10.64%, reflecting solid profitability. Revenue growth has been strong, with a 31.07% increase from 2021 to 2022, although recent growth has been moderate. The EBIT and EBITDA margins are healthy, indicating robust operational efficiency.

Balance Sheet

Ulta Beauty's balance sheet is relatively strong, with a debt-to-equity ratio of 0.77, suggesting moderate leverage. The return on equity for TTM is approximately 48.28%, indicating excellent efficiency in using equity to generate profits. The equity ratio is 41.45%, showing a stable capital structure. However, the company does carry a significant amount of debt, which could pose risks if profitability declines.

Cash Flow

Cash flow performance is robust, with a TTM operating cash flow to net income ratio of 1.11, indicating strong cash conversion efficiency. The free cash flow to net income ratio is 0.80, suggesting that a significant portion of net income translates into free cash flow. Free cash flow growth has been positive, supporting ongoing investments and debt repayments.

Breakdown
Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement		Total Revenue
11.30B	11.21B	10.21B	8.63B	6.15B
	Gross Profit
4.39B	4.38B	4.04B	3.37B	1.95B
	EBIT
1.56B	1.68B	1.64B	1.30B	465.46M
	EBITDA
1.56B	1.94B	1.88B	1.57B	534.59M
	Net Income Common Stockholders
1.20B	1.29B	1.24B	985.84M	175.84M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
703.20M	766.59M	737.88M	431.56M	1.05B
	Total Assets
6.00B	5.71B	5.37B	4.76B	5.09B
	Total Debt
1.92B	1.91B	1.90B	1.85B	1.90B
	Net Debt
1.22B	1.14B	1.17B	1.42B	850.75M
	Total Liabilities
3.51B	3.43B	3.41B	3.23B	3.09B
	Stockholders Equity
2.49B	2.28B	1.96B	1.54B	2.00B
Cash Flow		Free Cash Flow
964.15M	1.04B	1.17B	887.08M	658.49M
	Operating Cash Flow
1.34B	1.48B	1.48B	1.06B	810.36M
	Investing Cash Flow
-383.09M	-441.43M	-314.58M	-176.48M	-48.75M
	Financing Cash Flow
-1.02B	-1.01B	-861.01M	-1.50B	-107.93M

Ulta Beauty Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 363.19
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ULTA, the sentiment is Neutral. The current price of 363.19 is above the 20-day moving average (MA) of 356.54, below the 50-day MA of 365.85, and below the 200-day MA of 380.61, indicating a neutral trend. The MACD of 0.32 indicates Negative momentum. The RSI at 56.14 is Neutral, neither overbought nor oversold. The STOCH value of 75.78 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for ULTA.

Ulta Beauty Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ULTA	77 Outperform	$16.46B	14.31	50.39%	―	0.79%	-2.70%
M	69 Neutral	$3.31B	5.74	13.40%	7.02%	-3.60%	442.87%
ELF	67 Neutral	$3.14B	33.15	14.24%	―	46.27%	-26.45%
JWN	64 Neutral	$3.90B	13.41	29.58%	3.29%	2.20%	120.00%
Sector *	59 Neutral	$11.74B	10.16	-1.06%	4.15%	1.27%	-16.61%
COTY	57 Neutral	$4.67B	40.12	0.33%	―	1.35%	-99.94%
EL	49 Neutral	$20.20B	147.29	-14.17%	4.04%	0.07%	-249.21%

Ulta Beauty Corporate Events

Ulta Beauty Announces Retirement of Key Executive

On March 13, 2025, Ulta Beauty announced that Jodi J. Caro, their General Counsel, Chief Risk & Compliance Officer, and Corporate Secretary, plans to retire later this spring. A successor will join the company next month to ensure a smooth transition, highlighting the company’s commitment to maintaining stability in its leadership team.