📊 ULTA Key Takeaways
Is Ulta Beauty, Inc. (ULTA) a Good Investment?
Ulta Beauty demonstrates solid revenue growth of 9.7% and strong free cash flow generation of $203.6M, supported by a conservative balance sheet and healthy gross margins of 40.1%. However, net income growth of 0% despite revenue expansion suggests margin compression that warrants caution, and the low quick ratio of 0.28x reflects elevated inventory levels that may indicate inventory management challenges.
Ulta Beauty remains fundamentally profitable, with strong gross margins, double-digit operating margins, and high returns on equity and assets that indicate a durable retail model. However, growth quality has weakened as revenue is nearly flat, net income is stagnant, diluted EPS is declining, and free cash flow conversion is currently very thin. The balance sheet is still healthy enough to support operations, but the combination of slowing growth and compressed cash generation argues for a neutral fundamental view.
Ulta Beauty, Inc. Key Strengths (ULTA)
- Strong revenue growth of 9.7% YoY demonstrates market demand and business momentum
- Robust free cash flow generation at $203.6M with healthy 6.4% FCF margin provides financial flexibility
- Conservative leverage with 0.31x debt-to-equity ratio and exceptional 2,423x interest coverage indicates minimal solvency risk
- Healthy gross margin of 40.1% reflects solid pricing power and operational efficiency in retail segment
- Positive operating cash flow of $261.9M supports sustainability of business operations and potential capital allocation
- Strong profitability profile with 39.6% gross margin, 12.4% operating margin, and 9.4% net margin
- High capital efficiency, with ROE of 30.3% and ROA of 11.4%
- Manageable leverage and solid financial stability, supported by 1.33x current ratio and low debt/equity of 0.30x
ULTA Stock Risks: Ulta Beauty, Inc. Investment Risks
- Net income flat YoY growth (0%) despite 9.7% revenue growth indicates significant margin compression and earnings quality deterioration
- Minimal EPS growth of 1.2% YoY suggests profitability headwinds not captured by revenue metrics alone
- Low quick ratio of 0.28x reflects disproportionately high inventory levels relative to liquid assets, signaling potential inventory management or demand challenges
- Modest cash position of $166.3M relative to $4.3B total liabilities limits financial cushion for unexpected disruptions
- Operating margin of 14.2% could face further pressure if revenue growth cannot translate to net income growth
- Revenue growth has slowed sharply to 0.8% YoY, signaling weaker top-line momentum
- Net income is flat and diluted EPS declined 2.7% YoY, indicating limited earnings expansion
- Free cash flow is weak at just $78.92M and a 0.9% FCF margin, reducing financial flexibility
Key Metrics to Watch
- Net income growth trajectory and operating margin trend - critical to confirm if margin compression is temporary or structural
- Quick ratio movement and inventory turnover metrics - must improve to demonstrate effective working capital management
- Free cash flow sustainability - monitor if FCF conversion holds as primary indicator of true profitability
- Gross margin stability - any further compression would amplify profitability concerns
- Free cash flow and operating cash flow conversion
- Comparable sales or revenue growth alongside operating margin stability
Ulta Beauty, Inc. (ULTA) Financial Metrics & Key Ratios
💡 AI Analyst Insight
Ulta Beauty, Inc. presents a mixed fundamental picture. Review the detailed metrics above to form your own investment thesis.
ULTA Profit Margin, ROE & Profitability Analysis
ULTA vs Consumer Sector: How Ulta Beauty, Inc. Compares
How Ulta Beauty, Inc. compares to Consumer sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Ulta Beauty, Inc. Stock Overvalued? ULTA Valuation Analysis 2026
Based on fundamental analysis, Ulta Beauty, Inc. has mixed fundamental signals relative to the Consumer sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
Ulta Beauty, Inc. Balance Sheet: ULTA Debt, Cash & Liquidity
ULTA Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Ulta Beauty, Inc.'s revenue has grown significantly by 44% over the 5-year period, indicating strong business expansion. The most recent EPS of $26.03 reflects profitable operations.
ULTA Revenue Growth, EPS Growth & YoY Performance
ULTA Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q1 2026 | $2.8B | $305.1M | $6.70 |
| Q3 2025 | $2.5B | $230.9M | $5.14 |
| Q2 2025 | $2.6B | $252.6M | $5.30 |
| Q1 2025 | $2.7B | $305.1M | $6.47 |
| Q3 2024 | $2.5B | $242.2M | $5.07 |
| Q2 2024 | $2.5B | $252.6M | $5.30 |
| Q1 2024 | $2.6B | $313.1M | $6.47 |
| Q3 2023 | $2.3B | $249.5M | $5.07 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Ulta Beauty, Inc. Dividends, Buybacks & Capital Allocation
ULTA SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Ulta Beauty, Inc. (CIK: 0001403568)
📋 Recent SEC Filings
❓ Frequently Asked Questions about ULTA
What is the AI rating for ULTA?
Ulta Beauty, Inc. (ULTA) has a Combined AI Grade of B from Claude (B) and ChatGPT (B) with 77% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are ULTA's key strengths?
Claude: Strong revenue growth of 9.7% YoY demonstrates market demand and business momentum. Robust free cash flow generation at $203.6M with healthy 6.4% FCF margin provides financial flexibility. ChatGPT: Strong profitability profile with 39.6% gross margin, 12.4% operating margin, and 9.4% net margin. High capital efficiency, with ROE of 30.3% and ROA of 11.4%.
What are the risks of investing in ULTA?
Claude: Net income flat YoY growth (0%) despite 9.7% revenue growth indicates significant margin compression and earnings quality deterioration. Minimal EPS growth of 1.2% YoY suggests profitability headwinds not captured by revenue metrics alone. ChatGPT: Revenue growth has slowed sharply to 0.8% YoY, signaling weaker top-line momentum. Net income is flat and diluted EPS declined 2.7% YoY, indicating limited earnings expansion.
What is ULTA's revenue and growth?
Ulta Beauty, Inc. reported revenue of $3.2B.
Does ULTA pay dividends?
Ulta Beauty, Inc. pays dividends, with $62.5M distributed to shareholders in the trailing twelve months.
Where can I find ULTA SEC filings?
Official SEC filings for Ulta Beauty, Inc. (CIK: 0001403568) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is ULTA's EPS?
Ulta Beauty, Inc. has a diluted EPS of $7.74.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined grade reflects both perspectives for balanced insights.
What is ULTA's fundamental grade?
Based on our AI fundamental analysis in June 2026, Ulta Beauty, Inc. has a B grade with 77% confidence. Review the strengths and risks sections above for full context. This is not investment advice.
Is ULTA stock overvalued or undervalued?
Valuation metrics for ULTA: ROE of 13.2% (sector avg: 18%), net margin of 10.8% (sector avg: 8%). Compare these metrics with sector averages to assess valuation.
What is ULTA's AI grade for 2026?
Our dual AI analysis gives Ulta Beauty, Inc. a combined B grade for 2026. Revenue is data pending, with profitability above sector average. Always conduct your own research.
What is ULTA's free cash flow?
Ulta Beauty, Inc.'s operating cash flow is $261.9M, with capital expenditures of $58.3M. FCF margin is 6.4%.
How does ULTA compare to other Consumer stocks?
Vs Consumer sector averages: Net margin 10.8% (avg: 8%), ROE 13.2% (avg: 18%), current ratio 1.31 (avg: 1.5).