ULTA Beauty (ULTA) PT Raised to $472 at JPMorgan

JPMorgan analyst Christopher Horvers raised the price target on ULTA Beauty (NASDAQ: ULTA) to $472.00 (from $450.00) while maintaining a Overweight rating.

The analyst comments "At a high level, the overall message from ULTA’s Analyst Day hit the mark from a long-term algo expectation perspective (+LDD EPS vs. +HSDe, Figure 1) with a glass half full/empty outcome on 2025 commentary. On the latter, ULTA clearly had an agenda item to de-risk 2025 guidance indicating “positive comps below the 3-4% algo” and operating margin “below 12% with 11% as a floor” (with 2025 to face outsized pressures from investments) vs. the Street’s 11.6% per Consensus Metrix. This suggested earnings flat, at best, in 2025 (~7% below the prior consensus of $24.60 at the midpoint of the guide), with the potential for a decline considering ~2% unit growth, positive comps, a ~100-bp plus operating margin decline, and ~5% repo-driven EPS growth. While not all estimates have been updated, the current 2025 EPS consensus appears to be settling out close to $23 with +1% SSS and a 11.6% op margin. As we previewed, given the challenges experienced by ULTA over the past year and the unproven credibility of a new CFO trying to manage through an industry slowdown/share loss in prestige, it was unlikely ULTA tried to take the Street up over any period. The lack of a negative stock reaction, a topic we received many questions on, reflected our view of 7/10 bearish positioning into the event and the fact it was only valued on 2024 with no credit given for 2025."

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