Ulta Beauty (ULTA) AI Stock Analysis

• Market Cap: $23.10B
• Dividend Yield: N/A
• Average Volume (3M): 682.71K
• Price to Earnings (P/E): 25.2
• Beta (1Y): 0.76
• Revenue Growth: 5.45%
• EPS Growth: 4.28%
• Country: US
• Employees: 20,000
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Specialty Retail
• EPS (TTM): 8.01
• Shares Outstanding: 44,362,170
• 10 Day Avg. Volume: 1,144,156
• 30 Day Avg. Volume: 682,708
• PEG Ratio: 22.87
• Price to Book (P/B): 10.35
• Price to Sales (P/S): 2.34
• P/FCF Ratio: 27.18
• Enterprise Value/Market Cap: 1.09
• Enterprise Value/Revenue: 2.02
• Enterprise Value/Gross Profit: 5.18
• Enterprise Value/Ebitda: 13.62
• 1Y Price Target: $714.88
• Price Target Upside: 36.67% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 18
• EPS Forecast (FY): 28.65
• Revenue Forecast (FY): $13.15B

• Rating: 63 Neutral
• Price Target: $571.00 ▲(9.16% Upside)
• Action: Reiterated Date: 03/14/26
• Date: Action: Reiterated 03/14/26

ULTA scores as a moderately attractive setup driven by strong underlying financial quality and generally constructive FY2026 guidance (including planned buybacks). The score is held back most by very weak technicals (price below key moving averages with negative MACD) and by signs of slowing growth and margin pressure, with valuation appearing only fair at ~25x earnings given those trends.

Positive Factors

Cash generation

Sustained operating cash flow (~$1.5B) and strong free cash flow (~$1.07B) provide durable funding for capex, store growth, supply‑chain automation, and sizable share repurchases. This cash buffer supports strategic investments and cushions the business through cyclical softness.

Loyalty and omnichannel

A large, growing loyalty base and strengthened omnichannel capabilities (buy-anywhere/fulfill-anywhere, rising app usage) create durable customer retention and higher spend per customer. These structural assets improve lifetime value and resilience versus single-channel competitors.

Strategic expansion and assortment

International expansion and a broader curated marketplace diversify revenue and reduce reliance on US comps. New brand wins and cross-border footprint strengthen prestige offerings and long-term category mix optionality, supporting future margin and market-share gains.

Negative Factors

SG&A growth and deleverage

Material SG&A expansion from incentives, Space NK integration and guest investments weakens operating leverage. If revenue growth stays modest, higher fixed and recurring costs can persistently compress operating margins and reduce cash-flow conversion over the medium term.

Inventory build / working capital risk

A sizable inventory increase tied to new brands and acquisitions ties up cash and elevates markdown and obsolescence risk. In a promotional or slowing-demand environment, higher working capital can pressure gross margins and free cash flow conversion for multiple quarters.

Slowing growth and margin compression

A deceleration from double-digit growth to low-single-digit sales gains, coupled with falling net margins, reduces earnings momentum. Without a clear return to stronger comps or margin recovery, ROE and long-term profitability may remain below prior peak levels.

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 primarily generates revenue from retail sales of beauty and personal care products sold through its physical stores and digital commerce platforms. Product sales span multiple categories (cosmetics, fragrance, skin care, hair care, and beauty tools), with revenue driven by customer traffic, conversion, average ticket size, and the mix of mass versus prestige products. A secondary revenue stream comes from in-store services, particularly salon, which adds service revenue and can support product attachment (customers purchasing hair and beauty products alongside services). The company also benefits from its loyalty program by encouraging repeat purchases and higher spend through points-based rewards and targeted promotions; specific financial contribution figures are null. Ulta’s earnings are further influenced by merchandising and supplier economics typical in beauty retail (e.g., vendor funding, promotional support, and inventory/margin management), but any specific amounts or named partnership terms are null.

Ulta Beauty Financial Statement Overview

Summary

Overall financials are strong for Specialty Retail (stable ~39% gross margin, sizable ~$1.50B operating cash flow and ~$1.07B free cash flow in 2026), but recent momentum has cooled: revenue growth slowed (~3.4% in 2026) and net margin compressed (to ~9.3% in 2026). Leverage is reasonable with improving debt-to-equity, though total debt has risen and cash-flow conversion is only moderate.

Income Statement

Revenue has grown steadily over the last several years (from $6.2B in 2021 to $12.4B in 2026), but the latest year shows a clear slowdown in growth (2026 revenue growth of ~3.4% vs. ~9.8% in 2024 and ~18.3% in 2023). Profitability remains solid with gross margin stable around ~39%, though net margin has trended down recently (from ~12.2% in 2023 to ~9.3% in 2026), indicating some pressure from operating costs and/or pricing dynamics. Overall, this is a strong earnings profile for specialty retail, but momentum has cooled versus the prior peak years.

Balance Sheet

The balance sheet looks healthy with equity growing (to ~$2.8B in 2026) and leverage moderate for the sector, with debt-to-equity improving versus earlier periods (about 0.78 in 2026 vs. ~1.20 in 2022). Returns on equity are very strong (still ~41% in 2026), but have come down from the exceptionally high levels seen in 2022–2024, consistent with softer profitability. Key risk to watch is that total debt has risen (to ~$2.18B in 2026), so continued margin pressure could reduce flexibility even though leverage is currently reasonable.

Cash Flow

Cash generation is solid, with operating cash flow of ~$1.50B and free cash flow of ~$1.07B in 2026. However, free cash flow conversion relative to earnings is only moderate (free cash flow at ~71% of net income in 2026), and operating cash flow relative to debt is also moderate (about 0.68x in 2026). Free cash flow growth rebounded in 2026 (~+2.6%) after declines in 2024 and 2025, but overall cash-flow momentum has been somewhat uneven.

Breakdown	Jan 2026	Jan 2025	Jan 2024	Jan 2023	Jan 2022
Income Statement
Total Revenue	12.39B	11.30B	11.21B	10.21B	8.63B
Gross Profit	4.85B	4.39B	4.38B	4.04B	3.37B
EBITDA	1.85B	1.85B	1.94B	1.88B	1.57B
Net Income	1.15B	1.20B	1.29B	1.24B	985.84M
Balance Sheet
Total Assets	7.00B	6.00B	5.71B	5.37B	4.76B
Cash, Cash Equivalents and Short-Term Investments	494.24M	703.20M	766.59M	737.88M	431.56M
Total Debt	2.18B	1.92B	1.91B	1.90B	1.85B
Total Liabilities	4.20B	3.51B	3.43B	3.41B	3.23B
Stockholders Equity	2.80B	2.49B	2.28B	1.96B	1.54B
Cash Flow
Free Cash Flow	1.07B	964.15M	1.04B	1.17B	887.08M
Operating Cash Flow	1.50B	1.34B	1.48B	1.48B	1.06B
Investing Cash Flow	-931.35M	-383.09M	-441.43M	-314.58M	-176.48M
Financing Cash Flow	-850.67M	-1.02B	-1.01B	-861.01M	-1.50B

Ulta Beauty Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 523.07
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ULTA, the sentiment is Negative. The current price of 523.07 is below the 20-day moving average (MA) of 646.78, below the 50-day MA of 659.45, and below the 200-day MA of 556.82, indicating a bearish trend. The MACD of -30.19 indicates Positive momentum. The RSI at 21.81 is Positive, neither overbought nor oversold. The STOCH value of 1.93 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ULTA.

Ulta Beauty Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SBH	64 Neutral	$1.37B	7.65	23.43%	―	-0.42%	31.64%
ULTA	63 Neutral	$23.10B	25.17	44.07%	―	5.45%	4.28%
EBAY	63 Neutral	$41.94B	19.34	42.68%	1.38%	4.89%	17.30%
CHWY	63 Neutral	$10.47B	57.58	55.17%	―	9.80%	-46.84%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
BBWI	56 Neutral	$4.08B	7.11	-44.22%	4.16%	-1.04%	-20.88%
ETSY	55 Neutral	$5.29B	33.41	-15.36%	―	1.98%	-20.98%

Ulta Beauty Corporate Events

Ulta Beauty Adopts Standardized Executive Severance Plan Framework

On December 15, 2025, Ulta Beauty, Inc. adopted a new Executive Severance Plan that standardizes severance and benefits for its executive officers in the event of an involuntary termination without cause, excluding terminations tied to a change in control, death, or disability. Under the plan, eligible executives will receive two times base salary paid over 24 months, a cash lump sum equal to one times the lower of their target or actual annual bonus for the year of termination, and up to 12 months of company-paid COBRA premiums, contingent on signing a release of claims and complying with restrictive covenants for 24 months; the plan replaces prior severance arrangements for executives but leaves intact the company’s existing change-in-control severance framework, signaling a move toward more unified and predictable executive exit terms for stakeholders.

The most recent analyst rating on (ULTA) stock is a Buy with a $700.00 price target. To see the full list of analyst forecasts on Ulta Beauty stock, see the ULTA Stock Forecast page.