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[video] Jim Cramer: A Rotten Quarter From Ulta

NEW YORK ( Real Money) -- "Tougher-than-expected sales environment ... heightened promotional environment ... Heightened promotional environment of the holiday season ... highly promotional holiday season ... highly promotional holiday season ... less certain consumer environment ... an environment that looks to be more promotional."

Believe it or not, these were all heard on one conference call last night: that of Ulta Salon (ULTA), following a report that showed a quarter going steadily downhill as the months dragged on.

If you don't know Ulta, then you don't know the high-growth retail world. It's a world where some companies believe that there is endless demand for more stores, and that the idea, when executed properly, never runs out.

In Ulta's case, the numbers have been fabulous, but the situation has been suspect -- as anyone paying attention to Herb Greenberg here would know. Congrats to Herb for telling you to be careful before the quarter's announcement. That warning paid for a hundred subscriptions to Real Money if you were in it and sold or shorted the thing.

I have no question that Herb is right about how the new CEO is unsure that the company is executing well.

But I also have no doubt that this company is a metaphor for why the Federal Reserve's job is so difficult. Why should a store that sells beauty products be so badly hit if the economy is so strong?

The answer is, as with Conn's (CONN) yesterday, some parts of this nation are strong and others are weak. Plus, retail has become a changed landscape -- one in which companies have become increasingly desperate for business.

Be mindful of Ulta, and not just because of the management problems red-flagged so well by Herb.

Be mindful, because retail has become too hard to invest in. It's just too difficult to figure who is in trouble and who isn't, which means a lower multiple on lowered earnings going forward.

At the time of publication, Action Alerts PLUS, which Cramer co-manages as a charitable trust, had no positions in stocks mentioned.

Editor's Note: This article was originally published at 7:32 a.m. EST on Real Money on Dec. 6.

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