Switch to:
GuruFocus has detected 4 Warning Signs with Ulta Beauty Inc $ULTA.
More than 500,000 people have already joined GuruFocus to track the stocks they follow and exchange investment ideas.
Ulta Beauty Inc (NAS:ULTA)
Total Inventories
$1,137 Mil (As of Oct. 2016)

Ulta Beauty Inc's total inventories for the quarter that ended in Oct. 2016 was $1,137 Mil. Ulta Beauty Inc's average total inventories from the quarter that ended in Jul. 2016 to the quarter that ended in Oct. 2016 was $1,034 Mil.

In Ben Graham’s calculation of liquidation value, inventory is only considered worth half of its book value. Ulta Beauty Inc's liquidation value for the quarter that ended in Oct. 2016 was $-238 Mil.

Inventory can be measured by days sales of inventory (DSI). Ulta Beauty Inc's days sales of inventory (DSI) for the three months ended in Oct. 2016 was 83.38.

Days inventory indicates the number of days of goods in sales that a company has in the inventory. Ulta Beauty Inc's days inventory for the three months ended in Oct. 2016 was 133.94.

Inventory turnover measures how fast the company turns over its inventory within a year. Ulta Beauty Inc's inventory turnover for the quarter that ended in Oct. 2016 was 0.68.

Inventory to revenue ratio determines the ability of a company to manage their inventory levels. It measures the percentage of Inventories the company currently has on hand to support the current amount of Revenue. Ulta Beauty Inc's inventory to revenue ratio for the quarter that ended in Oct. 2016 was 0.91.


Definition

Total Inventories includes the raw materials, work-in-process goods and completely finished goods of a company. It is a portion of a company’s current assets.


Explanation

Inventory control is an important part of business operation. If a company does not have enough inventory, it may not be able to meet customers’ required delivery time. If it has too much inventory, the cost of holding the inventory can be high.

1. In Ben Graham’s calculation of liquidation value, inventory is only considered worth half of its book value.

Ulta Beauty Inc's liquidation value for the quarter that ended in Oct. 2016 is

Liquidation value (Q: Oct. 2016 )
=Cash and Cash Equivalents-Total Liabilities+(0.75 * Account Receivable)+(0.5 * Inventory)
=243.108-1099.117+0.75 * 65.708+0.5 * 1137.023
=-238

2. Inventory can be measured by Days Sales of Inventory (DSI).

Ulta Beauty Inc's Days Sales of Inventory for the three months ended in Oct. 2016 is

Days Sales of Inventory (DSI)
=Average Inventory (Q: Oct. 2016 )/Revenue (Q: Oct. 2016 )*Days in Period
=1033.614/1131.232*365 / 4
=83.38

3. Days Inventory indicates the number of days of goods in sales that a company has in the inventory.

Ulta Beauty Inc's Days Inventory for the three months ended in Oct. 2016 is calculated as:

Days Inventory=Average Inventory (Q: Oct. 2016 )/Cost of Goods Sold (Q: Oct. 2016 )*Days in Period
=1033.614/704.179*365 / 4
=133.94

4. Inventory Turnover measures how fast the company turns over its inventory within a year.

Ulta Beauty Inc's Inventory Turnover for the quarter that ended in Oct. 2016 is calculated as

Inventory Turnover=Cost of Goods Sold (Q: Oct. 2016 ) / Average Inventory (Q: Oct. 2016 )
=704.179 / 1033.614
=0.68

5. Inventory to Revenue determines the ability of a company to manage their inventory levels. It measures the percentage of Inventories the company currently has on hand to support the current amount of Revenue.

Ulta Beauty Inc's Inventory to Revenue for the quarter that ended in Oct. 2016 is calculated as

Inventory to Revenue=Average Inventory (Q: Oct. 2016 ) / Revenue (Q: Oct. 2016 )
=1033.614 / 1131.232
=0.91

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.


Be Aware

Manufacturers with durable competitive advantages have the advantage that the products they sell do not change, and therefore will never become obsolete. Buffett likes this advantage.

When identifying manufacturers with durable competitive advantage, look for inventory and net earnings that rise correspondingly. This indicates that the company is finding profitable ways to increase sales which called for an increase in inventory.

Manufacturers with inventories that spike up and down are indicative of competitive industries subject to boom and bust.


Related Terms

Revenue, Cash and Cash Equivalents, Total Liabilities, Account Receivable, Inventory, NCAV, Days Inventory, Cost of Goods Sold, Inventory Turnover, Inventory to Revenue


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Ulta Beauty Inc Annual Data

Jan07Jan08Jan09Jan10Jan11Jan12Jan13Jan14Jan15Jan16
Inventory 129176214207219245361458581762

Ulta Beauty Inc Quarterly Data

Jul14Oct14Jan15Apr15Jul15Oct15Jan16Apr16Jul16Oct16
Inventory 5427105816637068847628439301,137
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
FEEDBACK