Looking Into Ulta Beauty's Return On Invested Capital

According to Benzinga Pro, during Q2, Ulta Beauty ULTA earned $332.31 million, a 8.84% increase from the preceding quarter. Ulta Beauty also posted a total of $1.97 billion in sales, a 1.44% increase since Q1. In Q1, Ulta Beauty earned $305.32 million, and total sales reached $1.94 billion.

Why Is ROIC Significant?

Return on Invested Capital is a measure of yearly pre-tax profit relative to capital invested by a business. Changes in earnings and sales indicate shifts in a company's ROIC. A higher ROIC is generally representative of successful growth of a company and is a sign of higher earnings per share in the future. A low or negative ROIC suggests the opposite. In Q2, Ulta Beauty posted an ROIC of 17.68%.

Keep in mind, while ROIC is a good measure of a company's recent performance, it is not a highly reliable predictor of a company's earnings or sales in the near future.

Return on Invested Capital is a measure of yearly pre-tax profit relative to capital invested by a business. Changes in earnings and sales indicate shifts in a company's ROIC. A higher ROIC is generally representative of successful growth of a company and is a sign of higher earnings per share in the future. A low or negative ROIC suggests the opposite. In Q2, Ulta Beauty posted an ROIC of 17.68%.

Keep in mind, while ROIC is a good measure of a company's recent performance, it is not a highly reliable predictor of a company's earnings or sales in the near future.

For Ulta Beauty, the positive return on invested capital ratio of 17.68% suggests that management is allocating their capital effectively. Effective capital allocation is a positive indicator that a company will achieve more durable success and favorable long-term returns.

Upcoming Earnings Estimate

Ulta Beauty reported Q2 earnings per share at $4.56/share, which beat analyst predictions of $2.42/share.

Market News and Data brought to you by Benzinga APIs
Comments
Loading...
Date
▲▼
ticker
▲▼
name
▲▼
Actual EPS
▲▼
EPS Surprise
▲▼
Actual Rev
▲▼
Rev Surprise
▲▼
Posted In: EarningsBZI-ROCE
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!