ULTA - Ulta Beauty Stock Has Little Upside According to 1 Wall Street Analyst
2024-04-22 18:45:00 ET
Ulta Beauty (NASDAQ: ULTA) shares have been underperforming the market lately, leaving shareholders worried about its future returns. That's understandable. The spa and beauty products retailer posted higher earnings in its most recent quarter, yet sales trends were disappointingly weak.
That bearish narrative might not improve, at least in the short term. Last week, an analyst at Jefferies downgraded the stock from a buy rating to a hold while slashing the firm's 12-month price target. Ulta Beauty might land at $438 per share in that time, representing very little upside from its current price of roughly $415 per share. The analyst's prior target was $585 per share.
The analyst points out that the retailer faces some big headwinds. For one, the makeup category is slowing down to a more normal growth rate following its post-pandemic spike. Competition is rising at the same time, according to the downgrade.
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Ulta Beauty Stock Has Little Upside, According to 1 Wall Street Analyst