Ulta (ULTA) Comes Up With 3Q Surprise, Oppenheimer Rates It Outperform.

Oppenheimer Equity Research in a quarterly report has rated beauty products retailer Ulta (NASDAQ: ULTA) as Outperform.

Oppenheimer has set a target price of $20 for Ulta based on a discounted cash flow (DCF) valuation. Ulta is expected to show strong store growth numbers and is attractively poised to exploit real estate opportunities and store economics.

An analysis of Ulta on the basis of price earning (P/E) ratio reveals that it is trading at a premium to its peers. However, Oppenheimer believes that this is misleading due to Ulta’s higher depreciation and amortization expenses.