Ulta Beauty Stock Up On Q4 Earnings Beat, Positive FY25 Sales View, $900 Mln Buyback Plan

(RTTNews) - Shares of Ulta Beauty Inc. (ULTA) gained around 7 percent in the after-hours trading on Thursday after the specialty beauty retailer reported fourth-quarter earnings above market estimates, and issued fiscal 2025 outlook, expecting higher sales. The company also announced plans for share repurchases of approximately $900 million for fiscal 2025.

Meanwhile, earnings for the new year are expected to be lower than last year and below market estimates, with sales in line or below the Street.

Kecia Steelman, president and chief executive officer, said, "I am incredibly optimistic about the future of Ulta Beauty, as I believe we have the right elements to drive our success - a strong business model, an ambitious long-term plan, and passionate associates who bring our brand to life for our guests every day. Fiscal 2025 will be a pivotal year as we make purposeful investments to fuel our future growth and move quickly to optimize our business."

For fiscal 2025, the company expects earnings per share of $22.50 to $22.90, compared to prior year's $25.34. Net sales are expected to be between $11.5 billion and $11.6 billion with comparable sales growth of 0 percent to 1 percent.

The Wall Street analysts on average expect the company to report earnings of $23.13 per share on sales of $11.61 billion. Analysts' estimates typically exclude special items.

In fiscal 2024, the company's net sales were $11.3 billion, with comparable sales growth of 0.7 percent.

Further, the company plans share repurchases of approximately $900 million for fiscal 2025. As of February 1, $2.7 billion remained available under its previous $3.0 billion share repurchase program announced in October 2024.

In its fourth quarter, Ulta Beauty's net earnings came in at $393.27 million, slightly lower than last year's $394.37 million. Earnings per share, however, climbed to $8.46 from $8.08 last year with lower sharecount.

Analysts had expected the company to earn $7.15 per share.

The company's revenue for the period fell 1.9 percent to $3.49 billion from $3.55 billion last year primarily due to the benefit of an extra week of sales in fiscal 2023.

Comparable sales increased 1.5 percent on top of a 2.5 percent in the prior year, driven by a 3.0 percent increase in average ticket and a 1.4 percent decrease in transactions.

On the Nasdaq, Ulta Beauty shares had closed Thursday's regular trading at $314.47, down 4.5 percent.

Following the earnings report, the shares gained 6.5 percent to reach $335.00.

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