Analysts Boost Target On Ulta Salon Cosmetics & Fragrance Inc.

Ulta Salon, Cosmetics & Fragrance Inc.

opened sharply higher Friday while analysts boosted their price targets in the wake of the company's latest earnings beat. The Bolling Brook, Ill., retailer and beauty parlor company changed hands recently at $153.27, up $8.71, after gaining more than 10 percent in pre-market trading. Piper Jaffray's Stephanie S. Wissink raised her price target 21 percent to $158 but maintained a Neutral rating, citing the company's valuation. Wissink recommended the company as a "core holding for longer-term investors" but predicted volatility for the shares over the next couple of years. Earnings in 2015 and 2016 will be below the company's long-term range of 20 percent because of relatively heavy investment in growth, Wissink said. Oppenheimer's Rupesh Parikh increased his target 9 percent to $175 and maintained a Buy rating while predicting "further outperformance." The company has beaten Wall Street's earnings expectations in each of the past five quarters. Ulta posted fourth-quarter same-store sales growth of 11.1 percent versus Wall Street's expectation of 7.5 percent and management guidance of between 6 percent and 8 percent. Earnings grew 21.5 percent to $1.33 a share, beating the consensus forecast of $1.27 a share. The company added $100 million to the $260.1 million available Jan. 31 under its existing buyback program. Among 15 analysts who follow Ulta, nine maintain Buy ratings, two at Over Weight and six at Hold. Thomson Reuters' automated stock scoring system rated Ulta at 9 Thursday, down from a top score of 10 the previous week. The lower score was based on earnings and fundamentals. The Thomson Reuters score combines quantitative data from a half-dozen common investment measures. The average score on Thursday for specialty retailers was 5.9.