Oppenheimer says investors not rushing in to buy amid Ulta downbeat commentary

Oppenheimer notes that at a conference, Ulta Beauty (ULTA) provided downbeat commentary on the U.S. beauty category, citing a deeper than expected moderation lately across categories from mass to prestige. This is weighing “disproportionally” on both Ulta and e.l.f. Beauty (ELF) shares on Wednesday morning, and to a lesser extent, Estee Lauder (EL), the firm says. Within its coupon tracker, Oppenheimer has seen slightly more aggressive promotions lately at Ulta. The firm is surprised by the moderation, and, at this point, is unclear whether this represents just a shorter-term blip. Oppenheimer no longer sees EPS upside potential at Ulta following the Amazon (AMZN) development and now does not expect investors to rush in to buy this dip amidst near-term category and competitive concerns. The firm has an Outperform rating on Ulta’s shares.