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Ulta Salon & Cosmetics(ULTA - Get Report) sells cosmetics, fragrances and skin- and hair-care products. It also has in-house, full-service salons. Its stores are located in high-traffic, off-mall locations.
Ulta went public in 2007. Its stock has gained 27% in 2011 and delivered annualized gains of 64% since 2008. Of analysts covering Ulta, half advise buying its stock and half recommend holding it.
JPMorgan offers the highest price target, at $50, ranking Ulta "overweight." The stock commands a premium over peers, costing 25-times forward earnings.
Ulta's adjusted fiscal fourth-quarter earnings increased 41% to 48 cents, outperforming the consensus target by 7.9%. Its sales stretched 20% to $474 million, exceeding consensus by 1.3%. Ulta's gross margin widened from 36% to 37% and its operating margin rose from 8.7% past 10%. Ulta held $111 million of cash and no debt, for a quick ratio of 0.8, at quarter's end. Comparable-store sales, a key metric for retailers, grew more than 10% during the quarter. The company plans to open 61 new stores in 2011 and it is targeting 25% to 30% full-year net income growth.