JPMorgan Raises PT on Ulta Beauty (ULTA) Stock After Strong Q1 Report

On May 30, JPMorgan raised the price target on Ulta Beauty, Inc. (NASDAQ:ULTA) from $477 to $525 and kept its Overweight rating on the stock.

Christopher Horvers from JPMorgan increased the price target on ULTA after the company posted above-expectation results during Q1 FY2025. Ulta Beauty posted robust growth with comparable sales soaring by 2.9% year-over-year, well above Wall Street estimates. The company expanded its active loyalty member base to a record 45 million, up 3% from a year ago.

JPMorgan Raises PT on Ulta Beauty (ULTA) Stock After Above Expectations Q1 Results

A female customer shopping for beauty products in a modern store.

Horvers pointed out that the company’s operating margin contributed almost 15% to earnings upside, posting 14.1% compared to the expected 12.4%. The company reported adjusted earnings per share of $6.70, surpassing estimates by $0.87.

The analyst mentioned that ULTA gained a share in mass and prestige, despite Amazon’s wider access and significant expansion of doors across retail in the past years. The analyst believes Ulta Beauty will gain from multiple expansions as its share gains relieve structural concerns, while the margin performance adds to the potential upward revisions.

Ulta Beauty, Inc. (NASDAQ:ULTA) operates as a speciality beauty retailer in the U.S., offering branded and private-label beauty products. The company operates its businesses through its retail stores, shop-in-shops, and online.

While we acknowledge the potential of ULTA to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than ULTA and that has 100x upside potential, check out our report about this cheapest AI stock.

Read Next: 30 Best Stocks to Buy Now According to Billionaires and 15 Small-Cap Healthcare Stocks Hedge Funds Are Buying.

Disclosure: None.