ULTA Will Navigate Earnings Momentum And New Markets Amid Spending Uncertainty

Analysts have lifted their price target for Ulta Beauty by about $29 to roughly $603 per share, citing continued earnings outperformance, improving revenue growth and margins, and confidence in the growth potential from its Space NK acquisition despite broader consumer spending concerns.

Analyst Commentary

Bullish analysts highlight that the upgraded rating reflects growing confidence in Ulta Beauty's ability to sustain earnings outperformance, even as the stock has lagged broader market benchmarks in recent months.

They point to the company’s consistent track record of beating quarterly expectations and the strategic rationale of the Space NK acquisition as key drivers supporting a higher valuation multiple.

Bullish Takeaways

• Four consecutive earnings beats reinforce the view that Ulta Beauty is executing well on merchandising, pricing, and cost discipline, supporting upside to consensus estimates.
• The Space NK acquisition is seen as a gateway into a large and attractive beauty market, adding a new growth pillar that could extend Ulta Beauty's runway for store and category expansion.
• Despite macro concerns around discretionary spending, demand resilience from core customers who remain committed to their beauty routines supports confidence in revenue durability.
• Analysts view the recent underperformance versus major equity benchmarks as creating an entry point for investors who believe earnings momentum and international growth can close the valuation gap.

What's in the News

• Ulta Beauty raised its fiscal 2025 outlook, now targeting approximately $12.3 billion in net sales, an operating margin of 12.3% to 12.4%, and diluted EPS of $25.20 to $25.50, up from prior guidance ranges. (Corporate guidance)
• The company advanced its share repurchase program, buying back 426,914 shares for $226.7 million between August 3 and November 1, 2025. This completed a $1.0 billion authorization covering 2,426,686 shares. (Buyback tranche update)
• Ulta Beauty appointed Christopher DelOrefice as Chief Financial Officer effective December 5, 2025. He brings more than two decades of financial leadership experience from Becton Dickinson and Johnson and Johnson. (Executive changes)
• Ulta Beauty opened its first Middle East store at The Avenues in Kuwait. This marks the start of a broader regional rollout with additional locations planned in the United Arab Emirates and Saudi Arabia through 2026. (Business expansion)
• The company launched UB Marketplace on ulta.com and the Ulta Beauty app, an invite only digital marketplace that broadens its assortment across beauty, wellness, and adjacent lifestyle categories while maintaining a unified shopping and rewards experience. (Product related announcement)

Valuation Changes

• The Fair Value Estimate has risen slightly, moving from approximately $575 per share to about $603 per share. This reflects a modestly higher intrinsic valuation.
• The Discount Rate has increased marginally, from around 8.36% to about 8.58%. This indicates a slightly higher assumed risk or required return in the valuation model.
• Revenue Growth has edged higher, with the long term assumption moving from roughly 5.88% to about 6.15%. This signals a modestly more optimistic outlook on top line expansion.
• The Net Profit Margin has improved slightly, with the forecast shifting from around 9.21% to about 9.34%. This suggests incremental gains in profitability expectations.
• The Future P/E has risen only fractionally, from about 21.81x to roughly 21.92x. This indicates minimal change in the multiple investors are expected to pay for forward earnings.