Ulta Beauty (NASDAQ:ULTA | ULTA Price Prediction) stock just earned a strong endorsement from Jefferies, which upgraded shares to Buy from Hold and raised its price target to $700 from $635. The firm sees a favorable risk/reward setup at current levels, arguing that the stock already reflects investor skepticism and modest margin expansion. For long-term investors watching the beauty sector, the call signals that the cycle may be turning.
Ulta Beauty shares are trading at $560.68 as of April 20, well below the new Jefferies target. The stock is down 7% year-to-date, even as the underlying business has delivered four consecutive quarters of earnings beats.
The broader Wall Street picture is constructive. The analyst consensus for ULTA stock sits at “Moderate Buy” with an average price target of $674.23, and 17 analysts currently rate the stock a Buy while 10 hold a neutral stance.
| Ticker | Company | Firm | Action | Old Rating | New Rating | Old Target | New Target |
|---|---|---|---|---|---|---|---|
| ULTA | Ulta Beauty | Jefferies | Upgrade | Hold | Buy | $635 | $700 |
The Analyst’s Case
Jefferies frames the upgrade around a broadening beauty backdrop and renewed makeup engagement, suggesting the category is entering a new growth phase. The firm points to improved brand newness and merchandise execution as key reasons Ulta is better positioned to capitalize on the cycle than it was a year ago.
Critically, spending expectations have been reset to a more realistic framework, which reduces the bar Ulta needs to clear to impress investors. Jefferies also highlights a broad pricing strategy and clearer cost discipline pointing toward modest margin expansion as additional reasons the risk/reward has improved.
Company Snapshot
Ulta Beauty closed fiscal year 2026 with revenue of $12.393 billion, up 10% year-over-year. The company posted Q4 EPS of $8.01 against a $7.15 estimate, its fourth straight quarterly beat. Comparable sales grew 6% in Q4, driven by a 4% increase in average ticket and 2% growth in transactions.
Management is guiding for fiscal 2027 diluted EPS of $28.05 to $28.55, representing growth of 9% to 11%. Net sales growth is projected at 6% to 7%, with comparable sales expected to rise 3% to 4%. Ulta Beauty CEO Kecia Steelman noted the company is “well positioned for sustainable, profitable growth in 2026 and beyond.”
Why the Move Matters Now
Jefferies projects Ulta’s revenue could reach $14.0 billion by 2027, a meaningful step up from current levels. At a trailing P/E ratio of 22x and a forward P/E ratio of 19x, the valuation isn’t cheap, but Jefferies argues the improving cycle justifies the multiple. Other bulls agree: UBS carries a $810 target and Piper Sandler sits at $725.
What It Means for Your Portfolio
If you believe the makeup cycle is genuinely turning and that Ulta Beauty’s brand execution improvements are durable, the Jefferies upgrade offers a credible framework for revisiting the stock. The reset in expectations and the company’s consistent earnings beats suggest the floor may be firmer than the year-to-date price decline implies.
That said, SG&A deleverage and macroeconomic uncertainty remain real risks worth monitoring. Watch for whether Ulta Beauty’s comparable sales growth trends above the 4% high end of guidance in the coming quarters as the clearest confirmation that the beauty cycle thesis is playing out.
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