Photo Credit: Mike Mozart
Ulta Salon, Cosmetics & Fragrance, Inc. (ULTA) Consumer Discretionary – Specialty Retail| Reports March 10, After Market Closes
Cosmetics and beauty product company, Ulta (ULTA), is scheduled to report fourth quarter earnings tomorrow, after the market closes. The company is prepared to close a banner fiscal 2015 which it beat in every quarter of the year. The Estimize community is looking for EPS of $1.54 and revenue of $1.24 billion, right in line with the Street on the top and bottom line. The Select Consensus is slightly more bullish, with EPS of $1.54 and a sales consensus $7 million greater than Wall Street. Ulta has seen favorable revisions activity of late, with earnings growing 7% and sales up 7%. Compared with Q4 2014, this predicts a YoY increase on the bottom line by 16% while sales are prepared to grow 19%. Historically the beauty company has consistently beat expectations, trumping Estimize 81% and Wall Street for 86% of recorded quarters.
Despite the overall weakness in consumer spending, beauty products have held strong with companies like Ulta and Sephora leading the way. Ulta is coming off its 8th consecutive quarter, beating on both the top and bottom line. The recent string of strong performances can be attributed to robust online traffic and sales. Overall in Q4 2014, online traffic was up 48%, sustained by effective use of targeted emails and promotions. Last quarter, the beauty products retailer posted a 12.8% increase in total sales store sales in which retail SSS were up 10.8%. Shares of Ulta have steadily followed the upbeat earnings, soaring 22% in 2016 alone. Yet, women fragrances have been a source of concern for the company with the category turning sharply negative to -7.8% compared to gains reported last quarter. Ulta’s market position, strategic outlook, and burgeoning cosmetics and beauty care products should be enough to mask the uncertainty in its sluggish fragrances segment.
