In This Article:
Ulta Beauty (NASDAQ:ULTA) jumps 11.2% as its Unleashed turnaround delivers better-than-expected Q1 comp sales and a lifted outlook.
In Q1, ULTA posted adjusted EPS of $6.70, handily topping forecasts, on a 4.4% sales rise that outpaced both Sephora and Amazon-driven market share gains. Management raised full-year guidance for revenue, EPS and comps, citing slowing share losses to prestige rivals and stronger teen and value-driven customer cohorts.
Evercore's Michael Binetti points to Ulta's early momentum among teens and its blend of innovation-with-value as a competitive edge, while Morgan Stanley's Simeon Gutman sees comps potentially hitting 2.5% in 2025 and 4.5% in 2026driving operating leverage and healthier margins.
Digital growth also impressed: Ulta's online revenue climbed 10% despite Amazon's beauty push, aided by features like Split Cart and Shop My Store that boost engagement and defend digital share. CEO Kecia Steelman says these efforts are translating into stronger engagement, increased relevance and measurable business impact. UBS's Michael Lasser adds that rising Net Promoter Scores across stores and e-commerce demonstrate crisper execution.
Investors should care because Ulta's dual-track recoveryrevived in-store comps plus robust digital gainssignals that its Unleashed initiative can sustain share gains and margin expansion, offsetting the headwinds that stalled growth last year.
This article first appeared on GuruFocus.