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Ulta Beauty (ULTA) Stock Sinks As Market Gains: What You Should Know

Ulta Beauty (ULTA) closed at $534.33 in the latest trading session, marking a -0.06% move from the prior day. This change lagged the S&P 500's daily gain of 0.33%. At the same time, the Dow added 0.3%, and the tech-heavy Nasdaq gained 1.92%.

Heading into today, shares of the beauty products retailer had gained 5.57% over the past month, outpacing the Retail-Wholesale sector's gain of 4.83% and lagging the S&P 500's gain of 5.67% in that time.

Wall Street will be looking for positivity from Ulta Beauty as it approaches its next earnings report date. The company is expected to report EPS of $6.76, up 7.3% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $2.61 billion, up 11.23% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $25.23 per share and revenue of $11.08 billion. These totals would mark changes of +5.08% and +8.53%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for Ulta Beauty. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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 has moved 0.09% higher. Ulta Beauty is holding a Zacks Rank of #2 (Buy) right now.

Investors should also note Ulta Beauty's current valuation metrics, including its Forward P/E ratio of 21.19. For comparison, its industry has an average Forward P/E of 12.18, which means Ulta Beauty is trading at a premium to the group.

Also, we should mention that ULTA has a PEG ratio of 1.73. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Retail - Miscellaneous was holding an average PEG ratio of 1.82 at yesterday's closing price.

The Retail - Miscellaneous industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 99, putting it in the top 40% 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.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.

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Ulta Beauty Inc. (ULTA) : Free Stock Analysis Report

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