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Ulta Beauty Stock Surges after Fiscal 4Q17 Results

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Mar. 19 2018, Updated 1:11 p.m. ET

Ulta Beauty stock rose after its results

Ulta Beauty (ULTA) stock rose 7.6% on March 16 in reaction to the company’s fiscal 4Q17[1. fiscal 4Q17 ended February 3, 2018] results. Ulta reported its fiscal 4Q17 results after the markets closed on March 15.

The company’s sales grew 22.6% in fiscal 4Q17 and were in line with analysts’ expectations. However, the company’s earnings lagged analysts’ estimates.

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YTD movement

On March 16, Ulta Beauty (ULTA) stock was down 0.8% on a YTD (year-to-date) basis. In comparison, the S&P 500 Index has risen 2.9% since the start of the year. In 2017, Ulta Beauty stock fell 12.3%, lagging the S&P 500 Index, which rose 19.4%. 

Investor concern over the slowdown in the beauty market, as well as growing competition from department stores and other retailers, adversely impacted Ulta Beauty stock.

More recently, the company’s stock was impacted by negative publicity resulting from allegations that it resold used products to customers. In its fiscal 4Q17 conference call, the company’s CEO, Mary Dillon, denied these allegations. Dillon indicated that the company hasn’t seen any negative impact of such allegations on its brand, store traffic, or financial results.

Store growth plans

Ulta Beauty (ULTA) opened 16 stores in fiscal 4Q17. Overall, Ulta Beauty opened 102 new stores, relocated seven stores, and remodeled 11 locations in fiscal 2017.

At the end of fiscal 2017, Ulta Beauty operated 1,074 stores in 48 states and the District of Columbia. Ulta Beauty plans to open about 100 new stores, and it expects to remodel or relocate 17 stores in fiscal 2018.

In this series, we’ll discuss the company’s sales, earnings, and margin performance in fiscal 4Q17. The next part of this series takes a closer look at Ulta Beauty’s earnings.

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