Ulta Beauty (ULTA) Stock Sinks As Market Gains: What You Should Know
In the latest trading session, Ulta Beauty (ULTA) closed at $320.44, marking a -0.17% move from the previous day. This change lagged the S&P 500's daily gain of 0.25%. At the same time, the Dow added 0.39%, and the tech-heavy Nasdaq lost 0.09%.
Heading into today, shares of the beauty products retailer had lost 12.39% over the past month, lagging the Retail-Wholesale sector's loss of 6.94% and the S&P 500's loss of 5.58% in that time.
Wall Street will be looking for positivity from ULTA as it approaches its next earnings report date. This is expected to be August 29, 2019. On that day, ULTA is projected to report earnings of $2.76 per share, which would represent year-over-year growth of 12.2%. Meanwhile, our latest consensus estimate is calling for revenue of $1.68 billion, up 12.65% from the prior-year quarter.
ULTA's full-year Zacks Consensus Estimates are calling for earnings of $12.96 per share and revenue of $7.54 billion. These results would represent year-over-year changes of +19.45% and +12.21%, respectively.
It is also important to note the recent changes to analyst estimates for ULTA. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. ULTA is holding a Zacks Rank of #2 (Buy) right now.
In terms of valuation, ULTA is currently trading at a Forward P/E ratio of 24.77. This valuation marks a premium compared to its industry's average Forward P/E of 9.61.
We can also see that ULTA currently has a PEG ratio of 1.35. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Retail - Miscellaneous was holding an average PEG ratio of 1.35 at yesterday's closing price.
The Retail - Miscellaneous industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 113, putting it in the top 45% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
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