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Ulta shares plunge after hours on weak trends

The Associated Press

NEWS: Ulta shares plunged in extended trading Thursday after the beauty products retailer reported a disappointing fiscal third quarter and gave a weak forecast, citing softer retail trends that may continue into the holiday shopping season.

DETAILS: The company said that despite a challenging environment, its third-quarter sales improved with large gains in its online business. It also opened 55 sites during the quarter, which is a record number of new stores. But its final results fell short of what Wall Street was expecting from the usually fast-growing company.

NUMBERS: Ulta Salon, Cosmetics & Fragrances Inc. said that its net income jumped to $45.4 million, or 70 cents per share, for the quarter that ended Nov. 2. That is up from $38.2 million, or 59 cents per share, in its third quarter last year. Revenue increased 22 percent to $618.8 million from $505.6 million.

Analysts polled by FactSet were anticipating earnings of 74 cents per share on revenue of $622.1 million.

FUTURE: The company expects to earn between $1.07 to $1.10 per share for its fourth quarter on revenue between $853 million and $867 million. Analysts were anticipating earnings of $1.24 per share on revenue of $893.6 million.

Ulta also said that it expects its earnings for the year will be up in the low 20 percentage point range versus the prior year. That is down from a prior forecast of roughly 25 percent earnings growth.

STOCK: Shares of the Bolingbrook, Ill.-based company fell $18.50, almost 16 percent, to $99.50 in after-hours trading following the report. Its shares fell $5.48 to close regular trading at $118 Thursday.