Ulta Beauty’s Blistering Rally to Start the Year Just Lost Momentum. What Happened?

Key Takeaways

• Ulta Beauty shares plunged Friday, erasing this year’s gains after the retailer’s quarterly profits and outlook disappointed.
• Analysts from Morgan Stanley, JPMorgan, and Oppenheimer cut their price targets for the stock following the results.

Ulta Beauty shares were off to a strong start this year, until this week.

Shares of Ulta (ULTA) were down nearly 11% around $557 in recent trading, a day after the beauty retailer’s quarterly profits and outlook disappointed. It was the worst-performing stock in the S&P 500 Friday, erasing its year-to-date gains.

Ulta reported earnings per share of $8.01 for the fourth quarter, 2 cents shy of analyst estimates compiled by Visible Alpha. Its revenue of $3.9 billion topped expectations.

Looking ahead, Ulta forecast comparable store sales growth of 2.5% to 3.5% and earnings per share of $28.05 and $28.55 for 2026. Both missed analysts’ consensus projections.

Why This Matters to Investors

Ulta’s stock has rallied in recent months amid resilient spending on beauty and self-care products. However, Friday’s sharp move lower suggests its weaker-than-expected outlook rattled investor confidence.

Analysts at Oppenheimer trimmed their price target to $650 from $750 on Ulta’s soft guidance. They warned economic and geopolitical uncertainty could also hold back Ulta’s sales more than previously anticipated.

JPMorgan and Morgan Stanley analysts also trimmed their price targets to $750 and $700, respectively. Still, both suggest gains for the stock, amid expectations of longer-term growth in the beauty category and Ulta’s market share.

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Friday’s drop dragged Ulta shares, which reached a fresh record high last month, into negative territory for the year. Still, they’re up more than 50% from the same time a year ago.

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