Why Analysts Like Ulta Salon Cosmetics (ULTA)

This story has been updated from 10:09 am EST with analyst comments, stock price update.

NEW YORK (TheStreet) -- Shares of Ulta Salon, Cosmetics & Fragrance, Inc.  (ULTA) are spiking, up 18% to $114.69 on Friday, after the company's price target was raised to $130 from $118 at Citigroup (C) , following a better than expected second quarter earnings results and a positive third-quarter outlook that was reported yesterday after the market close.

Analysts at the firm said the cosmetics retailer remains a "consistently strong performer in a competitive and challenging environment," and kept its "buy" rating.

Ulta Salon Cosmetics posted second quarter earnings of 94 cents per share, beating theThomson Reuters consensus of 83 cents per share.

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Revenue grew 22.2% from the same quarter of last year to $734.23 million for the quarter, beating analysts' estimates of $713.01 million.

The company said it expects third quarter earnings of 79 cents to 84 cents per share on revenue of $724 million to $736 million, compared to analysts' estimates of 83 cents a share on revenue of $717.46 million for the quarter.

Sterne Agee analyst Ike Boruchow also rates the company a "buy."

"In today's retail environment, few retailers other than Ulta can achieve positive traffic and HSD comps in the near term, with double-digit footage growth and 20%+ EPS growth over the medium term - while operating a clearly differentiated business model in a stable, growing category," Boruchow wrote to clients. "All told, ULTA is one of the most compelling short- and long-term growth stories in retail today, and we would remain buyers of the shares."

Separately, TheStreet Ratings team rates ULTA SALON COSMETCS & FRAG as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

"We rate ULTA SALON COSMETCS & FRAG (ULTA) a BUY. This is driven by some important positives, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, impressive record of earnings per share growth, compelling growth in net income and good cash flow from operations. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself."

ULTA Chart ULTA data by YCharts
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