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Ulta Beauty - AI Stock Analysis

Analysis generated March 11, 2025

Ulta Beauty is a leading beauty retailer in the United States offering consumers prestige, mass, and salon products and services. The company provides a one-stop shop for cosmetics, fragrance, skincare, and hair care. Ulta Beauty has been known for its expansive product selection, loyalty rewards program, and in-store experience that combines shopping with salon services.

Fundamental Analysis

The revenue for Ulta Beauty in the last quarter was $2.53 billion. This represents a decrease of 0.86% compared to the previous quarter, suggesting a potential slowdown in growth. However, on a year-over-year basis, revenue grew by 1.65%, indicating that the company is still on a positive growth trajectory.

Net income for the last quarter stood at $242 million. This marks a decrease of 4.11% from the previous quarter and a 2.93% decline year-over-year. These figures may be cause for concern as they indicate shrinking profitability.

EBITDA for the last quarter was $390 million, showing a 2.16% decline compared to the previous quarter. However, a modest year-over-year increase of 0.46% suggests some positive operational efficiency.

The current Price to Earnings (P/E) ratio is 14.22, which is within a normal range. This neither indicates overvaluation nor undervaluation of the stock, placing Ulta Beauty in a moderate financial stance.

Technical Analysis

Today's stock price for Ulta Beauty is $338.81. This is a decrease of 9.54% compared to a month ago, which may be concerning in the short term. Over the course of a year, the stock has decreased by 39.02%, pointing towards longer-term concerns and a bearish trend.

The Simple Moving Average (SMA) for 10 days is currently at $352.49, down from a previous SMA10 of $355.24. This suggests a potential downward trend in price movement. Additionally, the Relative Strength Index (RSI) is at 24.9, indicating that the stock might be in an oversold condition, which could present a buying opportunity if the fundamentals align.

Alternative Data Analysis

Ulta Beauty has 6,297 open positions as per the data from various job boards. This number has decreased by 25% over the last few months, indicating measures to improve margins or cut costs. The employee sentiment is neutral, adding neither positive nor negative factors to the overall outlook.

In terms of customer acquisition, Ulta Beauty's website had an estimated 27 million visitors recently, down by 31% over the last couple of months. Similarly, their app downloads have dropped by 28%, standing at an estimated 7,300 daily downloads. Both trends underscore potential challenges in maintaining customer growth.

Regarding customer engagement, Ulta Beauty has a stable presence on social media with 7.3 million Instagram followers and 690,000 Twitter followers. There has been no meaningful change in these numbers, showing a stable but not increasing level of engagement.

AltIndex AI Score, which predicts stock performance based on various data points, gives Ulta Beauty a score of 42, signaling a "Hold".

Conclusion and Recommendation

Considering the mixed performance across multiple metrics, Ulta Beauty presents both risk and opportunity. The company's year-over-year revenue growth and EBITDA increase indicate resilience, but declining net income and concerning trends in customer acquisition and engagement raise red flags. The technical indicators point towards a bearish trend, but the oversold RSI may indicate a potential buying window. Finally, the AltIndex AI score suggests a hold status, which aligns with the overall analysis.

A balanced approach may be advisable, carefully weighing the company's operational performance, market conditions, and broader economic factors.

Disclaimer: This AI stock analysis, generated by an experimental AI tool, is for informational purposes only and not financial advice. Information is based on publicly available data and may not always be accurate or current.