In the latest trading session, Ulta Beauty (ULTA) closed at $430.27, marking a +1.58% move from the previous day. This change outpaced the S&P 500’s 0.92% gain on the day. Elsewhere, the Dow gained 0.1%, while the tech-heavy Nasdaq added 0.98%.
Coming into today, shares of the beauty products retailer had gained 6.19% in the past month. In that same time, the Retail-Wholesale sector gained 2.03%, while the S&P 500 gained 9.6%.
Ulta Beauty will be looking to display strength as it nears its next earnings release, which is expected to be December 1, 2022. The company is expected to report EPS of $4.06, up 3.05% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $2.18 billion, up 9.47% from the prior-year quarter.
It is also important to note the recent changes to analyst estimates for Ulta Beauty. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company’s business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.09% lower. Ulta Beauty is holding a Zacks Rank of #4 (Sell) right now.
Investors should also note Ulta Beauty’s current valuation metrics, including its Forward P/E ratio of 19.85. This represents a premium compared to its industry’s average Forward P/E of 11.95.
Meanwhile, ULTA’s PEG ratio is currently 1.43. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock’s expected earnings growth rate. The Retail – Miscellaneous industry currently had an average PEG ratio of 1.65 as of yesterday’s close.
The Retail – Miscellaneous industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 129, which puts it in the bottom 49% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
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