Inside Ulta Beauty's Terrible Week
Not many growth stocks have had as bad of a 2019 as Ulta Beauty (NASDAQ: ULTA). Though Ulta's competitive advantages remain intact, the overall cosmetics industry -- where Ulta gets more than 50% of its revenue and which contains some of its higher-margin products -- is slowing. After several years of very strong growth due to the adoption of new makeup routines, the surprise slowdown caused a big re-rating of Ulta's stock downward in late August.
However, while many investors were hoping for a strong bounce-back, it doesn't appear an industry rebound will be forthcoming in the near term. Even CEO Mary Dillon seemed to hint that there wouldn't be a quick fix, as a lack of new innovation is bringing growth in this consumer discretionary sector to a halt.
Unfortunately, not just one but several news events this week seemed to indicate that Ulta is still having trouble in this "new normal" for the industry. Here are the lowlights of Ulta's very bad week.
Source Fool.com
