Ulta Beauty, Inc. (ULTA) stock analysis

P/E above its 5-year median

Ulta Beauty's P/E of 24.0 is above its own 5-year median of 19.6.

P/E above the industry

Ulta Beauty's P/E of 24.0 is above the Miscellaneous Retail median of 17.9.

EV/EBITDA above its 5-year median

Ulta Beauty's EV/EBITDA of 14.6 is above its 5-year median of 12.2.

P/B above the industry

Ulta Beauty's price-to-book of 10.66 is above the Miscellaneous Retail median of 2.05.

Trading above fair value

The share price of $659.08 is above our fair value estimate of $481.91.

Margin of safety under 20%

The price is 36.8% above fair value, so there is no margin of safety.

Revenue growing under 10% a year

Revenue grew 6.7% a year over the last three fiscal years, short of the 10% we look for.

EPS growing under 10% a year

Diluted EPS grew 2.2% a year over the last three fiscal years.

Earnings growth not accelerating

Net income grew 0.7% over the last twelve months, against a 5-year average of 45.7% a year.

Growing faster than the industry

Revenue grew 11.2% over the last twelve months; the Miscellaneous Retail median is 2.6%.

Guidance issued

The latest outlook (Fiscal 2026 Net sales growth, Mar 12, 2026) was issued for the first time, so it neither adds nor takes away points.

Gross margin improving

Gross margin was 39.3% over the last twelve months, against 39.0% a year earlier.

Return on equity over 15%

Return on equity was 46.1% over the last twelve months and averaged 56.4% over five years.

Return on capital over 10%

Return on invested capital was 45.2%, above the 10% that usually covers the cost of capital.

Return on equity above the industry

Ulta Beauty's return on equity of 46.1% is above the Miscellaneous Retail median of -3.7%.

Earnings grew over 5 years

Net income grew 45.7% a year on average over the last five fiscal years.

Net margin below its 5-year average

Net margin was 9.3% over the last twelve months, against a 5-year average of 11.0%.

Net margin above the industry

Ulta Beauty's net margin of 9.3% is above the Miscellaneous Retail median of -2.5%.

Low debt

Debt is 12.8% of shareholders' equity, under the 40% we consider low.

Debt trend

Needs a balance sheet from five years ago with positive equity.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 462% of total debt.

Interest coverage

Interest expense is not reported separately.

Short-term assets cover short-term debts

Current assets are 1.35 times current liabilities.

Low bankruptcy risk

The Altman Z-score is 6.99; above 3 is the safe zone and below 1.8 the distress zone.

No dividend

Ulta Beauty has not paid a dividend in the last twelve months.

Yield against Treasuries

No dividend.

Yield against the market

No dividend.

Dividend stability

No dividend.

Earnings cover

No dividend.

Cash-flow cover

No dividend.