We all know the problems that retailers have been having with shoplifting lately. Anyone who’s gone to a drugstore recently and found most of the products in locked cabinets knows that much. But beauty retailer Ulta Beauty (NASDAQ:ULTA) believes that more can be done, and it’s looking for ways to do that itself. Investors, meanwhile, aren’t exactly unhappy about the idea and pushed shares up fractionally in Tuesday afternoon’s trading.
Though Ulta Beauty’s approach to the issue may not be what some would like to hear, it’s at least trying to take on the problem. Ulta Beauty noted that one of the big problems is online retailers like Amazon (NASDAQ:AMZN), which are serving as a clearinghouse for stolen goods. Ulta Beauty, via CEO Dave Kimbell, wouldn’t comment specifically that Amazon was part of a problem, instead referring to “online marketplaces,” but Kimbell did declare those marketplaces “part of the problem.”
Kimbell then took the high road for Ulta itself, noting that “…with 100% certainty, nothing that we sell at Ulta.com or any online platform is product that’s been stolen from another retailer.” Amazon, for its part, referred to the $1 billion annually it invests in fighting fraud.
These Remarks Come at an Interesting Time for Ulta Beauty
These remarks come at an interesting time for Ulta Beauty; its fourth-quarter earnings report is set to come out on Thursday. And while Ulta is expected to post earnings and revenue growth, there may be some question of just how much. Is this Ulta’s way of trying to distract from potentially disappointing earnings in advance by calling attention to what it may blame as an issue behind the earnings figures? There’s no way to know until Thursday, of course, but it’s something to consider.
Is ULTA a Good Stock to Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on ULTA stock based on six Buys and three Holds assigned in the past three months, as indicated by the graphic below. After a 7.55% rally in its share price over the past year, the average ULTA price target of $592.11 per share implies 7.39% upside potential.
