Ulta Beauty, Inc. (NASDAQ: ULTA) is back in the spotlight. After delivering another stronger‑than‑expected quarter and raising its full‑year outlook, the beauty retailer’s shares have jumped to fresh highs, helped along by a wave of bullish analyst revisions and a high‑profile upgrade from TD Cowen on December 8, 2025. [1]
As of early trading on December 8, Ulta Beauty stock is changing hands around $600–$610 per share, up more than 12% since the Q3 report and roughly 42% year‑to‑date, putting the stock near its 52‑week high of about $612. [2]
Below is a detailed look at the latest news, forecasts, and analysis shaping Ulta Beauty’s stock right now.
Ulta Beauty Stock Today: Trading Near Record Highs
Following earnings released after the close on December 4, 2025, Ulta Beauty shares spiked double‑digits as investors digested a classic “beat and raise” quarter. Net sales grew 12.9% year over year to around $2.9 billion, with comparable sales up 6.3%, driven by a mix of higher traffic and higher average ticket. [3]
Key Q3 2025 highlights:
- Net sales: ~$2.9 billion, +12.9% YoY, ahead of roughly $2.7 billion consensus
- Comparable sales: +6.3% (≈ +3.8% traffic, +2.4% average ticket) [4]
- Diluted EPS:$5.14, beating estimates in the $4.50–$4.60 range and flat versus the prior year period [5]
- Gross margin:40.4%, up 70 basis points year over year
- Operating margin: about 10.8% of sales [6]
Despite intense competition and a still‑mixed macro backdrop, Ulta delivered its 15th earnings beat in 16 quarters, according to 24/7 Wall St., underscoring a track record of consistent execution. [7]
The immediate reaction: Ulta’s share price jumped more than 11% intraday on the news, with TradingView noting that such large moves are rare for the relatively low‑volatility stock. [8]
Guidance Raised: A More Confident Outlook for Fiscal 2025
Management didn’t just beat expectations — they raised the bar.
According to the Q3 commentary and subsequent coverage, Ulta now expects for fiscal 2025: [9]
- Net sales: around $12.3 billion
- Comparable sales growth:4.4%–4.7%
- Q4 comp growth:2.5%–3.5%
- Operating margin:12.3%–12.4%
- Full‑year EPS:$25.20–$25.50
Wall Street forecast data compiled by StockAnalysis broadly aligns with this narrative, modeling full‑year revenue at roughly $12.4 billion (about 9.8% growth from ~$11.3 billion) and EPS around $25.3. [10]
Looking ahead to next year, analysts expect:
- Revenue 2026: ≈ $12.9 billion (≈ 4.1% growth)
- EPS 2026: ≈ $27.55, implying ~8.8% EPS growth year over year [11]
In other words, Q3 suggests that Ulta is transitioning from a “reset” year to a still‑healthy mid‑single‑digit top‑line growth profile with high‑single‑digit earnings growth.
Operating Engine: Stores, Digital, and Loyalty
Ulta’s growth engine remains a blend of physical stores, digital engagement, and an enormous loyalty ecosystem.
Recent data points from the Q3 call and related coverage show: [12]
- Store base: about 1,500 U.S. stores, after opening 28 new locations in Q3 alone.
- Omnichannel strength: management highlighted ongoing double‑digit e‑commerce growth.
- App engagement: roughly 65% of online member sales now come through the Ulta app, pointing to strong mobile stickiness.
- Loyalty program: Ulta has a record ~46 million loyalty members, with Investor Day targets to reach 50 million by 2028.
- International expansion: Ulta acquired premium beauty retailer Space NK and its 80+ stores in the UK and Ireland and is moving into Mexico (franchises) and the Middle East (joint venture). [13]
At its October 2024 Investor Day, Ulta also laid out long‑term financial targets for 2026 and beyond: [14]
- 4%–6% annual net sales growth
- Mid‑single‑digit operating profit growth, targeting ~12% operating margins
- Low double‑digit EPS growth over time
So far, the trajectory implied by 2025–2026 forecasts fits comfortably within those long‑range goals.
Capital Allocation: Heavy Buybacks, Modest Debt
Ulta remains a buyback‑only story on capital returns — the company doesn’t pay a dividend but is returning substantial cash via repurchases.
From Q3 filings and MarketBeat’s post‑earnings analysis: [15]
- Ulta repurchased 426,914 shares in Q3 for about $224.7 million.
- Year‑to‑date, it has retired roughly 1.7 million shares for $693 million.
- Share count is down about 5% year‑to‑date, and the company still has roughly $2 billion remaining under its current authorization.
- Since 2014, Ulta has returned more than $6 billion to shareholders through buybacks.
MarketBeat estimates that recent repurchase activity equates to an effective buyback yield of around 4%, a meaningful tailwind for per‑share earnings and long‑term returns. [16]
There was one negative headline in Q3: an increase in short‑term debt, as Ulta tapped its revolving credit facility to support working capital tied to higher inventory and receivables. However, cash still covers about half of total debt, total liabilities sit at about 2.2x equity, and the company has essentially no long‑term financial debt beyond lease liabilities, according to MarketBeat. [17]
The takeaway: leverage is rising but remains conservative, and management appears comfortable balancing growth investments with buybacks.
Wall Street Turns More Bullish: TD Cowen, DA Davidson and Others Lift Targets
The strongest single piece of news on December 8, 2025, came from TD Cowen.
- TD Cowen analyst Oliver Chen upgraded Ulta Beauty from “Hold” to “Buy” and lifted his price target from $600 to $725, a 20.8% increase and now the highest target on the Street. [18]
His move followed a flurry of positive revisions on December 5:
- DA Davidson: $625 → $650, rating “Strong Buy”
- Canaccord Genuity: $653 → $674, “Strong Buy”
- Oppenheimer: $600 → $615, “Buy/Outperform”
- Piper Sandler: $590 → $615, “Overweight/Buy”
- Evercore ISI: $640 → $660, “Outperform”
- UBS: $680 → $690, “Buy”
- Telsey Advisory Group: $610 → $640, “Outperform”
- J.P. Morgan: $606 → $647, “Overweight” [19]
In addition, a recent MarketBeat feature argued that the ongoing price‑target revision trend points to a $650 “fair” range and leaves room for roughly 18%–20% upside if the rally extends into 2026. [20]
Consensus Ratings and Price Targets
Different data providers show slightly different numbers, but the overall message is similar: Ulta is generally viewed as a “Buy/Outperform” with price targets clustered around the current share price and a wide band of outcomes.
- Benzinga (27 analysts):
- Consensus rating: Outperform / Buy
- Consensus 12‑month target:$566
- Range:$330 (low) to $725 (high)
- The three most recent ratings (TD Cowen, DA Davidson, Canaccord) average a target around $683, implying about 13% upside from ~$601. [21]
- StockAnalysis (23 covering analysts):
- Average target:$573.83, implying about -4.6% downside from the pre‑market price around $609.
- Median target:$605
- Range:$330–$725
- Consensus rating: Buy. [22]
- GuruFocus (22 analysts):
- Average target:$602.70 (≈ 0.2% upside from $601.50)
- Range:$411–$680
- Consensus recommendation: about 2.3 on a 1–5 scale, corresponding to “Outperform.” [23]
MarketBeat’s forecast summary likewise describes Ulta as a “Moderate Buy”, with an average target near $563, high $690, low $330. [24]
Bottom line: Wall Street is broadly positive, but the average 12‑month targets are only slightly above (or even a bit below) where the stock trades after its recent surge. The upside case depends on Ulta continuing to outperform those already‑raised expectations.
Valuation: Premium but Not Wildly Stretched
Using the current share price around $601.50 and fiscal‑2025 EPS expectations of roughly $25.3, Ulta trades at: [25]
- ~23–24× this year’s earnings
- ~22× next year’s consensus EPS of about $27.55
MarketBeat and 24/7 Wall St. place Ulta’s price‑to‑earnings multiple in the low‑20s, with operating margins near 10.8% and returns on equity approaching 46%–48% — a robust profitability profile. [26]
For context, 24/7 Wall St. notes that high‑growth peer e.l.f. Beauty (ELF) trades at around 58× earnings, with operating margins barely above 2%, versus Ulta’s roughly 23× P/E and 10.8% operating margin. [27]
Several valuation models suggest the stock isn’t cheap:
- GuruFocus’ GF Value estimates a one‑year “fair value” around $554, implying nearly 8% downside from current levels. [28]
- A Yahoo Finance valuation write‑up (recently throttled for direct access) indicated Ulta scores only 1 out of 6 on one under‑valuation metric, hinting that much of the good news may already be priced in. [29]
That leaves Ulta in an interesting spot: clearly premium, given the quality of the business and its track record, but still meaningfully cheaper than some high‑multiple beauty peers.
Institutional Interest: Big Money Is Accumulating
On December 8, 2025, MarketBeat reported that asset manager Ossiam increased its stake in Ulta Beauty by more than 10,000% in Q2, bringing its holdings to 82,345 shares (about 0.18% of the company), worth roughly $38.5 million at the time of filing. [30]
The same filing and related data show that:
- Total institutional ownership stands at around 90% of the float.
- Multiple other asset managers — including J. Safra Sarasin and Atria Investments — have recently added to, or initiated, positions. [31]
High institutional ownership can be a double‑edged sword: it often reflects confidence in the business model and supports liquidity, but it can also mean less “new money” is left to come in during future rallies. For now, the direction of flows appears supportive.
Longer‑Term Growth Story: Beauty, Wellness, and Global Expansion
Ulta’s pitch to investors is not just about the next quarter. Its long‑term plan, refreshed at the 2024 Investor Day, focuses on several structural drivers: [32]
- Store growth and remodels
- Targeting 1,800+ stores over the long run (vs. ~1,500 today).
- Ongoing remodels and relocations to refresh the in‑store experience.
- Loyalty and personalization
- Goal of 50 million loyalty members by 2028, up from the mid‑40‑million range today.
- Increased personalization and targeted offers driven by richer data and analytics.
- Wellness and new categories
- Expanded focus on wellness, skincare, and adjacent categories to capture a greater share of beauty‑related spending.
- Digital and omnichannel
- Continued investment in app experience, fulfillment options, and cross‑channel integration; app now drives about two‑thirds of online member sales. [33]
- International
- Building an international presence via Space NK in the UK/Ireland, franchise relationships in Mexico, and a joint venture in the Middle East. [34]
Combined with disciplined capital allocation (capex targeted at 4%–5% of net sales and ongoing buybacks), Ulta aims to deliver 4%–6% top‑line growth and low double‑digit EPS growth beyond 2026. [35]
Key Risks to the Ulta Beauty Investment Case
Even with all the momentum, Ulta isn’t risk‑free. Investors should keep several factors in mind:
- Macro and consumer spending
- Ulta’s business is discretionary. Management explicitly flags macro headwinds such as inflation, higher interest rates, and recession risk as potential pressure points for sales and margins. [36]
- Competition
- Ulta competes with Sephora (LVMH), department stores, mass retailers, specialty brands, and direct‑to‑consumer online players. Sephora’s own expansion plans underscore how intense this competition can be. [37]
- Margin pressure
- Wage inflation, store remodels, and investments in digital and services have weighed on operating margin, which sits below historical peaks. While Q3 showed margin resilience, some of those cost pressures are structural. [38]
- Inventory and supply chain
- Ulta increased inventory in Q3 to support new brands, international expansion, and the holiday season. Missteps in demand planning or supply chain disruptions could impact profitability. [39]
- Execution on international growth
- Expansion into Mexico and the Middle East introduces unfamiliar regulatory and operational environments. These moves could boost growth — or create new execution risks. [40]
- Valuation risk
- At more than 20× forward earnings, Ulta has less margin of safety if growth slows or a consumer downturn hits the category. Models from GuruFocus and other valuation frameworks already see the stock as slightly above fair value. [41]
Is Ulta Beauty Stock a Buy After the 2025 Rally?
From a fundamentals perspective, the bull case looks straightforward:
- Consistent execution: 15 beats in 16 quarters, with Q3 delivering double‑digit revenue growth and an EPS beat. [42]
- Structural tailwinds: Beauty and wellness remain resilient consumer categories, with Ulta’s broad assortment and omnichannel model capturing share.
- Loyalty and data moats: Tens of millions of engaged loyalty members and strong app usage deepen customer relationships and support targeted marketing. [43]
- Capital returns: Aggressive buybacks, modest leverage, and a multi‑billion‑dollar authorization in place. [44]
- Analyst and institutional support: Multiple price‑target hikes, a high‑profile TD Cowen upgrade to “Buy,” and >90% institutional ownership. [45]
The bear (or at least cautious) case hinges on:
- Valuation: Shares trade at a premium multiple, with some models suggesting limited upside or modest overvaluation.
- Consensus targets: Average 12‑month price targets hover around or even slightly below current levels, suggesting that a lot of good news is already reflected in the price. [46]
- Macro sensitivity: A consumer slowdown, renewed inflation pressures, or cost shocks could derail the margin and growth story. [47]
For growth‑oriented, quality‑focused investors comfortable paying up for a market‑leading retail franchise, Ulta’s combination of high returns on capital, strong cash generation, and sustained buybacks may still look attractive, especially if you believe management’s long‑term EPS growth targets.
For value‑oriented or more risk‑averse investors, the current price near record highs and a consensus target that isn’t dramatically above today’s level may justify patience, waiting either for a better entry point or for fundamentals to continue compounding and “grow into” the multiple.
Either way, Ulta Beauty is firmly on Wall Street’s radar going into 2026 — and after another standout quarter, the stock has earned its premium status.
References
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