Ulta Beauty Stock Up On New CEO Announcement, Raised Outlook: Retail's Unconvinced
It expects fourth-quarter sales to increase modestly and operating margin to be above the high end of the company’s previous expected range of 11.6% to 12.4% of sales.
FollowShares of Ulta Beauty were up 0.97% in after-hours trading session on Monday as the specialty retailer announced its CEO Dave Kimbell will step down from his post, with retail sentiment staying bearish.
Kecia Steelman, Ulta's president and COO will replace Kimbell as CEO effective Jan 6.
The company also raised its fourth quarter outlook, reflecting stronger-than-expected performance during the holiday season, it said in a statement.
Based on sales performance quarter-to-date, the company now expects comparable sales will increase modestly and operating margin will be above the high-end of the company’s previous expected range of 11.6% to 12.4% of sales for the fourth quarter of fiscal 2024. The company plans to report financial results for the fourth quarter and fiscal 2024 on March 13, 2025.
Retail sentiment on Stocktwits was ‘bearish’ compared to ‘neutral’ a week ago. Message volumes were in the ‘normal’ zone.
Kimbell became CEO of Ulta Beauty in 2021 after serving in executive roles with the company since 2014. During his tenure, the company grew to more than $11 billion in annual revenue and delivered double-digit growth in diluted earnings per share, the company noted.
“Kecia is a strategic leader with a proven record of driving operational excellence and creating exceptional guest experiences while fostering a caring and inclusive culture. I have every confidence she will expand Ulta Beauty’s leadership in beauty and wellness,” Kimbell said.
Steelman has been president and COO since 2023 after having joined the company in company in 2014. She has deep expertise across retail operations and services, real estate, corporate strategy, and business transformation.
Wells Fargo analyst Ike Boruchow raised the firm's price target on Ulta Beauty to $370 from $350 with an ‘Underweight’ rating on the shares, The Fly.com reported.
According to the analyst, while Ulta is the “first pre-upside top plan, it likely won't be the last, as Wells expects more bullish updates in retail into next week.”
Ulta Beauty, a retailer of cosmetics, fragrance, skincare ad hair care products, has more than 1,437 retail stores across 50 states.
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