Ulta Beauty shares plummeted close to -30% Friday, after the company lowered its fiscal- full-year outlook and also missed earnings expectations.
The chain of stores selling cosmetics and hair & skincare products reported net income of $2.76 per share which, although higher than the year-ago quarter’s $2.46, fell short of the Street estimate of $2.80.
Revenue for the quarter increased +12% year-over-year to $1.7 billion, which was in line with expectations.
Comparable sales (which in this case includes stores open at least 14 months and e-commerce sales) increased +6.2%. Last year same quarter, the growth was +6.5%.
But for the full-year, the company reduced its guidance citing headwinds in the U.S. cosmetics market. Ulta now expects EPS to range between $11.86 and $12.06 for the year, down from its prior projection of $12.83 to $13.03 range. The company indicated that the revision includes the effect of around $700 million in share buybacks and also the assumption of a 23% effective tax rate (versus 24% previously).
Ulta has predicted comparable sales growth of approximately +4% to +6%, down from previous estimates of +6% to +7%. The forecast includes e-commerce growth of +20% to +30%.
The company hopes to increase total sales by +9% to +12%, as compared to previous forecasts of low double-digit growth.
The company expressed plans to open around 80 new stores, remodel or relocate 20 others and do some touch-ups of about 270 stores.
ULTA may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options. In of 34 cases where ULTA's price broke its lower Bollinger Band, its price rose further in the following month. The odds of a continued upward trend are .
The RSI Indicator shows that the ticker has stayed in the oversold zone for 22 days. The price of this ticker is presumed to bounce back soon, since the longer the ticker stays in the oversold zone, the more promptly an Uptrend is expected.
The Stochastic Oscillator shows that the ticker has stayed in the oversold zone for 22 days. The price of this ticker is presumed to bounce back soon, since the longer the ticker stays in the oversold zone, the more promptly an upward trend is expected.
The Moving Average Convergence Divergence (MACD) for ULTA just turned positive on April 29, 2024. Looking at past instances where ULTA's MACD turned positive, the stock continued to rise in of 44 cases over the following month. The odds of a continued upward trend are .
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where ULTA advanced for three days, in of 346 cases, the price rose further within the following month. The odds of a continued upward trend are .
ULTA moved below its 50-day moving average on April 02, 2024 date and that indicates a change from an upward trend to a downward trend.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where ULTA declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
The Aroon Indicator for ULTA entered a downward trend on May 06, 2024. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options.
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating very strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating fairly steady price growth. ULTA’s price grows at a lower rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating that the returns do not compensate for the risks. ULTA’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 77, placing this stock better than average.
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is slightly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (11.198) is normal, around the industry mean (12.888). P/E Ratio (20.314) is within average values for comparable stocks, (35.906). Projected Growth (PEG Ratio) (2.047) is also within normal values, averaging (2.536). ULTA has a moderately low Dividend Yield (0.000) as compared to the industry average of (0.033). P/S Ratio (2.340) is also within normal values, averaging (88.545).
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to worse than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows
a company that retails cosmetics and other personal care products
Industry SpecialtyStores