Ulta Beauty Inc

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ULTA : NASDAQ : Services
$219.71 -4.1 | -1.8%
Today's Range: 219.7 - 224.72
Avg. Daily Volume: 1289800.0
09/21/17 - 3:59 PM ET

Financial Analysis


ULTA BEAUTY INC's gross profit margin for the second quarter of its fiscal year 2017 is essentially unchanged when compared to the same period a year ago. The company managed to grow both sales and net income at a faster pace than the average competitor in its industry this quarter as compared to the same quarter a year ago. ULTA BEAUTY INC has weak liquidity. Currently, the Quick Ratio is 0.60 which shows a lack of ability to cover short-term cash needs. The liquidity decreased from the same period a year ago, despite already having weak liquidity to begin with. This would indicate deteriorating cash flow.

During the same period, stockholders' equity ("net worth") has increased by 17.48% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.

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Income Statement Q2 FY17 Q2 FY16
Net Sales ($mil)1289.851069.22
EBITDA ($mil)242.91193.43
EBIT ($mil)179.8143.77
Net Income ($mil)114.1990.0


Balance Sheet Q2 FY17 Q2 FY16
Cash & Equiv. ($mil)272.86304.08
Total Assets ($mil)2702.222305.79
Total Debt ($mil)0.00.0
Equity ($mil)1635.351391.94


Profitability Q2 FY17 Q2 FY16
Gross Profit Margin41.2840.64
EBITDA Margin18.8318.09
Operating Margin13.9413.45
Sales Turnover1.971.87
Return on Assets17.415.65
Return on Equity28.7525.92
Debt Q2 FY17 Q2 FY16
Current Ratio2.792.8
Debt/Capital0.00.0
Interest Expense0.00.0
Interest Coverage0.00.0


Share Data Q2 FY17 Q2 FY16
Shares outstanding (mil)61.6562.4
Div / share0.00.0
EPS1.831.43
Book value / share26.5322.31
Institutional Own % n/a n/a
Avg Daily Volume1323509.0638459.0

Valuation


BUY. ULTA BEAUTY INC's P/E ratio indicates a premium compared to an average of 20.88 for the Specialty Retail industry and a premium compared to the S&P 500 average of 24.88. To use another comparison, its price-to-book ratio of 8.44 indicates a significant premium versus the S&P 500 average of 3.10 and a significant discount versus the industry average of 24.37. The price-to-sales ratio is above the S&P 500 average and well above the industry average, indicating a premium. The valuation analysis reveals that, ULTA BEAUTY INC seems to be trading at a premium to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
ULTA 29.78 Peers 20.88   ULTA 21.82 Peers 13.36

Premium. A higher P/E ratio than its peers can signify a more expensive stock or higher growth expectations.

ULTA is trading at a significant premium to its peers.

 

Premium. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

ULTA is trading at a significant premium to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
ULTA 22.73 Peers 19.10   ULTA 1.03 Peers 1.53

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

ULTA is trading at a significant premium to its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

ULTA trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
ULTA 8.44 Peers 24.37   ULTA 32.39 Peers 12.81

Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

ULTA is trading at a significant discount to its peers.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

ULTA is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
ULTA 2.60 Peers 1.43   ULTA 23.01 Peers 5.85

Premium. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

ULTA is trading at a significant premium to its industry.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

ULTA has a sales growth rate that significantly exceeds its peers.

 

 

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