Ulta Beauty Inc (ULTA, Financial) has recently been in the spotlight, drawing interest from investors and financial analysts due to its robust financial stance. With shares currently priced at $567.51, Ulta Beauty Inc has witnessed a daily gain of 0.06%, marked against a three-month change of 14.67%. A thorough analysis, underlined by the GF Score, suggests that Ulta Beauty Inc is well-positioned for substantial growth in the near future.
What Is the GF Score?
The GF Score is a stock performance ranking system developed by GuruFocus using five aspects of valuation, which has been found to be closely correlated to the long-term performances of stocks by backtesting from 2006 to 2021. The stocks with a higher GF Score generally generate higher returns than those with a lower GF Score. Therefore, when picking stocks, investors should invest in companies with high GF Scores. The GF Score ranges from 0 to 100, with 100 as the highest rank.
- Financial strength rank: 6/10
- Profitability rank: 9/10
- Growth rank: 10/10
- GF Value rank: 6/10
- Momentum rank: 10/10
With a high Growth rank and Momentum rank, and slightly lower but still strong Financial Strength and GF Value ranks, GuruFocus assigned Ulta Beauty Inc the GF Score of 95 out of 100, which signals the highest outperformance potential.
Understanding Ulta Beauty Inc's Business
Ulta Beauty Inc, with a market cap of $27.56 billion and sales of $10.88 billion, operates as the largest specialized beauty retailer in the U.S. The company, founded in 1990 and based in Bolingbrook, Illinois, boasts 1,355 stores at the end of fiscal 2022 and a partnership with Target. Ulta Beauty offers a diverse range of products including makeup, fragrances, skin care, and hair care, as well as bath and body items. It also provides salon services in all stores. Most Ulta stores are approximately 10,000 square feet and are located in suburban strip centers. The company's commitment to offering both private-label products and merchandise from over 500 vendors has positioned it as a leader in the beauty retail sector.
Financial Strength Breakdown
Ulta Beauty Inc's Financial Strength rating reflects a resilient balance sheet and prudent capital management. An Altman Z-Score of 8.01 indicates a strong defense against financial distress, while a Debt-to-Revenue ratio of 0.19 showcases strategic debt management, further solidifying its financial health.
Profitability Rank Breakdown
The Profitability Rank of Ulta Beauty Inc is impressive, with an increasing Operating Margin over the past five years, demonstrating enhanced profit generation. The company's Piotroski F-Score and a Predictability Rank of 4.0 stars out of five further confirm its solid financial situation and consistent operational performance.
Growth Rank Breakdown
Ulta Beauty Inc's high Growth rank underscores its commitment to business expansion. The company's 3-Year Revenue Growth Rate of 15.7% outperforms 75.72% of companies in the Retail - Cyclical industry. Additionally, a significant increase in EBITDA over the past few years highlights Ulta Beauty Inc's capability to sustain growth.
Next Steps
Considering Ulta Beauty Inc's financial strength, profitability, and growth metrics, the GF Score highlights the firm's unparalleled position for potential outperformance. Investors seeking to capitalize on such robust financial health and market leadership may find Ulta Beauty Inc an attractive option. For those looking to explore further, GuruFocus Premium members can discover more companies with strong GF Scores using the GF Score Screen.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
