ULTA Beauty (ULTA) PT Raised to $459 at Deutsche Bank

Deutsche Bank analyst Krisztina Katai raised the price target on ULTA Beauty (NASDAQ: ULTA) to $459.00 (from $446.00) while maintaining a Buy rating.

The analyst comments "There was a considerable level of uncertainty regarding ULTA's 3Q print, which the company easily laid to rest with its positive SSS inflection and profitability upside. Importantly, ULTA refuted the bear case that it is a share donor in the beauty space with +0.6% comp growth (vs. buy-side -1.0%) reflecting successful key promotional events, new brand launches, and positive traffic (accelerated to +9.2% on a two-year basis vs. +7.2% last quarter). We are particularly encouraged by the contrasting sales performance with Sephora, which reported deceleration in the quarter with Sephora @ KSS stores sales momentum slowing to 15% from 45% in 2Q, and SSS to 9% from low teens in 2Q. We think this adds fuel to the bull case and will spark a new debate on how much market share will shift in 2025. Furthermore, gross margin strength was another standout as inventory shrink was lower than last year (expected to be flat for the FY). Looking ahead, we see upside to 4Q guidance as promotional events drive traffic and prestige market share trends improve. Additionally, QTD performance through Cyber Monday has been encouraging. We walk away from today's print incrementally more positive on the company's handle of the P&L and its ability to drive top-line outperformance. We see a positive EPS revision cycle ahead and expect shares to move higher tomorrow. Buy."

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