Ulta Beauty (ULTA) (the “Company”) today announced that its Board of Directors has authorized a stock repurchase program pursuant to which the Company may repurchase up to $150 million of the Company’s common stock. The stock repurchase program is effective immediately and will be funded from available working capital.
This is silly for them to do. They will struggle to generate free cash flow this year and will eat away at their cash levels. If they buy anything it will be a token amount, IMO.
How much do you want to bet that Goldman talks these guys into doing a debt offering soon? I can hear the bankers whisper in their ear right now...."rates will never be lower....you can't go wrong....you can fund a bigger buyback with the debt...do it now before the window of opportunity closes...."