UPDATE: In February of 2012 Ulta stock closed at an all time high of $84.17. This comes on the heels of the company increasing total assets to $930 million compared to $709 million one year ago. During this same time period the stock price has been up almost 90% while the S&P 500 is 1.37%.
On March 10th, 2011 Ulta Salon, Cosmetics & Fragrance reported very impressive fourth quarter numbers as the stock price accelerated 8% higher. During the fourth quarter net sales increased 19.5% while same store sales were up 10.4%. These number pleased analysts as there were several upgrades to ULTA stock. This beauty salon retailer has shown that coupons are one of many ways to enhance growth.
Each and every Sunday women seek the lowest prices for cosmetic products and it is often that case that Ulta not only offers the lowest prices but also offers quality. With a weekly sales ad that comes out in most Sunday newspapers, customers will find great discounts and incentives for shopping at Ulta. In fact, in many parts of the country, this retailer is the only true cosmetic retailer that offers specific products.
As we continue into 2011 it will be interesting to see if Ulta can continue to grow. It is often true that when a retailer gains momentum they can use this momentum to open new stores and go into untapped territory. This is exactly what Ulta plans to do as they realize that the market for cosmetic products is wide open in many small to medium sized cities throughout the country. As of March 10th, 2011 Ulta has total assets of $730.5 million and has a strong desire to hit $1 billion in the next two years.
The outlook for Ulta in 2011 is as follows:
For the first quarter of fiscal 2011, the Company currently expects net sales in the range of $364 million to $370 million, compared to actual net sales of $320.2 million in the first quarter of fiscal 2010. This assumes comparable stores sales increase of 5% to 7%, compared to a 10.8% increase last year. In addition, the Company plans to open 5 new stores in the first quarter.
Income per diluted share for the first quarter of fiscal 2011 is estimated to be in the range of $0.29 to $0.31. This compares to income per diluted share for first quarter fiscal 2010 of $0.23.
For fiscal 2011, the Company plans to:
Open approximately 61 new stores expanding square footage by approximately 16%, remodel 17 stores and relocate 1 store;
incur capital expenditures of approximately $130 million, compared to $97.1 million in fiscal 2010;
reduce inventory by approximately 3% on an average per store basis by year end 2011;
generate free cash flow.
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