Investment Thesis
Nearly two decades of consecutive growth and profitability at Ulta Beauty (ULTA) came to a screeching halt as COVID-19 induced lockdowns and other social distancing measures. After crashing 57% in March and recovering 98% by June, Ulta’s stock has once again slid 25% under a resurgence of coronavirus cases. The recent weakness in the stock price is an opportunity to accumulate shares in a company driven by innovation with a focus on meeting consumer needs by any means necessary. Although a DCF valuation implies growth for this decade is currently fairly