In a report released yesterday, Ike Boruchow from Wells Fargo reiterated a Sell rating on Ulta Beauty (ULTA – Research Report), with a price target of $350.00.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
Ike Boruchow has given his Sell rating due to a combination of factors impacting Ulta Beauty’s financial performance. Despite a solid first quarter showing with a notable earnings per share beat, Boruchow remains cautious due to ongoing concerns about the company’s fundamental health. The gross and operating margins continue to face erosion, and the company’s overall model appears to be in a state of transition, necessitating further proof of improvement before altering the current rating.
Additionally, while Ulta’s management has shown some positive results, such as a strong e-commerce performance and reduced promotional activities, there are still significant challenges ahead. The makeup category remains under pressure, and the company faces uncertainties in the latter half of the fiscal year due to external factors like tariffs and macroeconomic conditions. These elements contribute to a conservative full-year outlook, reinforcing the need for Ulta to demonstrate a more robust turnaround in its margins and profits to warrant a more favorable rating.
Based on the recent corporate insider activity of 27 insiders, corporate insider sentiment is neutral on the stock.