Ulta's Holiday Season Sales Soar - Analyst Blog
January 08 2013 - 5:50AM
Zacks
Illinois-based Ulta Salon,
Cosmetics & Fragrance Inc. (ULTA) turned up with yet
another sturdy sales number for the seven-week period starting from
the week before Thanksgiving through the end of the week of
Christmas. Ulta Salon, which sells cosmetics, fragrance, haircare
and other beauty products, added market share during this holiday
season across all its segments with skincare and cosmetics topping
the list.
Net sales for the holiday period
soared 23.2% year over year to $475.6 million driven by a rise in
comparable store sales, which escalated 7.4% over 12.6% reported in
the prior-year period. Over a two-year holiday period, comparable
store sales surged 20.0%.
The largest beauty retailer that
provides a one-stop shop for prestige, mass and salon products and
services in the U.S. reported strong sales during the Black Friday
and Cyber Monday weekend. While sales dipped in the initial days of
December, it again picked up during Christmas.
We believe, gaining high single
digit comp growth was quite an achievement in the face of waning
consumer confidence due to the uncertainty regarding the fiscal
cliff in the U.S., which must have kept consumers busy and away
from discretionary activities.
The company, which operates 550
retail stores in 45 states continued to introduce exciting
merchandising and marketing plans as well as new product offerings
across all categories to attract customers. A successful loyalty
program and extended marketing reach also went in tandem with
value-minded customers during this holiday period.
Ulta, a Zacks #2 Rank (Buy) stock,
is witnessing winning momentum since the last couple of quarters
with an average earnings surprise of 5.12% in the trailing twelve
months period and hopes to finish the year on a high note.
Ulta Salon, however, reiterated its
expectation for the fourth quarter of fiscal 2012. For the fourth
quarter, Ulta expects earnings per share between 96–98 cents,
significantly higher than 73 cents in the year-earlier quarter. Net
sales are estimated in the range of $742–$754 million based on
comparable store sales growth of 5% to 7%. For fiscal 2012, the
company projects earnings per share in the range of
$2.64–$2.66.
On the other hand, one of its major
competitors Regis Corp. (RGS) is reeling under
pressure with continued sluggish traffic. Regis delivered 17
straight quarters of negative same-store sales. Furthermore, the
absence of the 2013 guidance also indicates lack of visibility in
the near term.
REGIS CORP/MN (RGS): Free Stock Analysis Report
ULTA SALON COSM (ULTA): Free Stock Analysis Report
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