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The Key Takeaways
- Ulta Beauty announced CEO Dave Kimbell's retirement Monday.
- JPMorgan analysts still call the company a "top pick," citing its improved fourth-quarter outlook.
- Ulta's Q4 comparable sales and operating margin update implies higher earnings per share (EPS) than Wall Street's consensus, the analysts said.
Ulta Beauty’s (ULTA’s) Chief Executive Officer Dave Kimbell announced his retirement Monday after the bell, but JPMorgan’s analysts do not see this as a problem for the business.
Late Monday night, analysts stated that cosmetics retailer remains a top choice for consumers. “top picks” They reiterated that they are targeting a $480 target. Ulta shares were little changed at $431.43 Tuesday afternoon after rising as high as 6.7% during the previous session.
JPMorgan Cites Outlook Boost As CEO Resigns
Ulta raised their fiscal fourth-quarter similar sales and operating profit margin forecast on Monday. “make sure that investors clearly understood that the CEO change had nothing to do with 4Q performance,” The JPMorgan Note said. Kecia Steelman, Chief Operating Officer (COO), has succeeded Kimbell.
JPMorgan reported that a 1% rise in Ulta’s comparable sales, combined with an operating margin just slightly above the range previously forecast by Ulta, would translate into earnings per share of $7.21 for this quarter, which is above Wall Street’s consensus estimate of $6.76.
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