Ulta Q3 Earnings: Key Factors to Watch

Ulta Beauty (NASDAQ: ULTA) is gearing up to release its earnings report tomorrow after the market closes, and there’s a lot of anticipation surrounding it. Last quarter, Ulta missed analysts’ revenue expectations by 2.3%, coming in at $2.55 billion, which was flat compared to the previous year. This led to a more challenging quarter, with the company’s full-year EPS guidance falling short of analysts’ expectations.

As we look ahead to this quarter, analysts are forecasting that Ulta’s revenue will remain flat year on year at approximately $2.50 billion, a slowdown from the 6.4% increase seen in the same quarter last year. Adjusted earnings are expected to be around $4.53 per share.

In the past month, analysts covering Ulta have largely stuck to their estimates, indicating that they believe the company will remain stable heading into earnings. Ulta has typically met or exceeded Wall Street’s revenue estimates, only falling short once in the past two years, with an average 1.8% outperformance.

Taking a look at its peers in the specialty retail sector, some have already reported their Q3 results, providing some insight into what we might expect. Bath and Body Works saw a 3.1% year-on-year revenue growth, surpassing analysts’ expectations by 1.9%, while Sally Beauty reported a 1.5% increase in revenues, meeting consensus estimates. After these results, Bath and Body Works saw a 14.7% increase in its stock price, and Sally Beauty was up 7.1%.

Investors in the specialty retail sector have been feeling positive, with share prices rising by an average of 7.5% over the last month. Ulta itself has seen a 3.3% increase during the same period and is entering earnings season with an average analyst price target of $400.16, compared to the current share price of $395.40. The anticipation is high as we wait to see how Ulta Beauty performs in its upcoming earnings announcement.