Ulta Beauty price target lowered to $328 from $355 at Barclays

Barclays lowered the firm’s price target on Ulta Beauty to $328 from $355 and keeps an Equal Weight rating on the shares. The analyst downgraded the U.S. specialty retail sector to Neutral from Positive citing erosion of inventory margin recapture as promotions intensify and demand weakens. In this “leverage phase” of margin expansion only a minority of companies with company-specific drivers can accelerate sales growth faster than fixed cost growth, the analyst tells investors in a research note. The firm sees the end of the “Retail Inventory Megacycle” along with intensifying promotional activity, which it believes suggests a weakening demand backdrop.