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MARKETS LIVE BLOG:

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Ulta (ULTA) Stock Earnings: What Should Investors Expect?

Eric Dutram
Updated

Most retail stocks have been very sluggish in recent years as intense competition and concerns over growth have ravaged the industry. However, some have been able to avoid this issues and stay on the path to growth, with Ulta (ULTA) being a great example of how to do it right.

The company has seen its shares soar by nearly 50% so far in 2016, while it has added over 80% in the past year. And from an even longer term look, the stock has been even more impressive, as it is now sporting an 183% gain in the past two years alone.

Part of this surge is thanks to its strength in earnings season, as the company has an excellent track record when it comes to beating estimates. In fact, the stock hasn’t missed estimates since late 2012, making for an incredible streak in earnings season.

ULTA SALON COSM Price and EPS Surprise

ULTA SALON COSM Price and EPS Surprise | ULTA SALON COSM Quote

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Curious about how you can trade ULTA ahead of its report? Make sure to watch Dave Bartosiak at 1pm central on Wednesday on our YouTube channel for more information on the best options trading strategies for ULTA.

But the most surprising part of this run has been the rapid increase in earnings estimates as of late. Even with lofty expectations, ULTA keeps delivering while growth is expected to remain on track as well. No wonder the stock currently has a growth grade of ‘A’ heading into the report.

ULTA SALON COSM Price and Consensus

ULTA SALON COSM Price and Consensus | ULTA SALON COSM Quote

So what’s in store for ULTA investors this time around? Well, things are certainly looking promising thanks to its growth score and its Zacks Rank of 2 or ‘buy’ but there are still questions. Valuations are getting extremely high (not to mention a Value Score of ‘D’), while the Earnings ESP is negative, two factors which could be trouble in the coming report.

ULTA may be able to continue its nice streak, but eventually the growth rate will slow down and this company will be hit hard. The only question is if that is this quarter or further down the line?

For a look at more ULTA fundamentals make sure to check out the video above. But if you are looking for tips on how to trade ULTA, make sure to watch Dave Bartosiak at 1pm central on Wednesday on our YouTube channel for more information on the best options trading strategies for ULTA.


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ULTA SALON COSM (ULTA): Free Stock Analysis Report
 
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Zacks Investment Research