By Senad Karaahmetovic According to a Beat-and-Raise Report, Ulta is a “Relative Star of Positivity” in the Retail Sector.
In premarket trading Friday, Ulta Beauty (NASDAQ: ULTA) stock was up more than 3% after the company reported strong earnings and raised its full-year forecast.
Ulta outperformed analysts’ expectations in the second quarter, generating earnings per share of $5.70 versus $4.90. The company’s revenue for the quarter was $2.3 billion, compared to the average forecast of $2.19 billion. Comparable sales increased by 14.4%, above the average expectation of 10.3%.
Ulta also increased its full-year sales projection to $9.65 billion to $9.75 billion, up from the previous range of $9.35 billion to $9.55 billion and higher than the expected $9.63 billion.
EPS is expected to be between $20.70 and $21.20, which is much higher than the previous range of $19.20 to $20.10. Similarly, comparable sales are now expected to increase by +9.5% to +10.5%, up from +6% to +8% previously, while analysts expected +8.2%.
The Stifel analyst boosted the price objective from $435 to $450 in response to “solid” performance.
“The excellent 2Q results show Ulta continues to acquire a considerable portion of a US beauty industry that is anticipated to expand in the mid-single digits.” The analyst stated in a client note that “We raise our 2022-2023 EPS forecasts to reflect the F2Q22 upside and a 53rd week in F2023
Ulta “continues to be a relative star of positivity in our retail coverage thus far in 2022,” according to a Wells Fargo analyst.
“The business is healthy, and forecast remains cautious,” the analyst said in a letter to clients.
