Ulta Beauty (ULTA) has announced that CEO Dave Kimbell is retiring from the cosmetics company where he has worked for the past 11 years.
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Kimbell will also step down from the company’s board of directors and is being succeeded in the CEO role by Ulta Beauty’s current President and Chief Operating Officer Kecia Steelman. In a news release, the company said that Kimbell will stay on at Ulta Beauty in an advisory role through June 28 of this year.
ULTA stock rose 3% in after hours trading on news of Kimbell’s retirement and the CEO succession. The company’s share price has underperformed the broader market recently, declining 11% over the past 12 months even as the benchmark S&P 500 index rose 25%.
Luxury Items
Ulta Beauty’s sales and profits have been under pressure as consumers turn away from the cosmetics retailer amid high inflation and elevated interest rates. Analysts say the company is viewed as a luxury, discretionary purchase at a time when consumers are focusing on staples such as food and rent.
Along with the CEO change, Ulta Beauty also forecast that its fourth quarter 2024 comparable sales will increase modestly and its operating margin will be above the high-end of its previously expected range of 11.6% to 12.4% due to solid year-end holiday sales.
Is ULTA Stock a Buy?
The stock of Ulta Beauty has a consensus Moderate Buy rating among 24 Wall Street analysts. That rating is based on 13 Buy, nine Hold, and two Sell recommendations made in the last three months. The average price target on ULTA stock of $404.83 implies 6.14% downside risk from current levels.
