Shares of Bolingbrook-based Ulta Salon, Cosmetics & Fragrance Inc. soared 18 percent to a 12:30 price of $26.25 Friday as investors reacted to a sweet-smelling quarterly profit report and outlook.
The stock, which has been in relatively steady ascent during the past 18 months, is closing in on its 52-week high of $26.75.
On Thursday, the beauty-products retailer said it had more than doubled profits in the second quarter, soundly beating analysts’ expectations. Better yet, it forecast a strong third quarter, despite the iffy economy.
Though beauty companies have been hurt by weak consumer spending and high unemployment, Reuters reported, some of the larger cosmetic companies, including Estee Lauder Cos Inc. and Elizabeth Arden Inc., swung to quarterly profits last month.
Ulta said it earned $13.1 million during the second quarter, a boost from the $5.7 it posted over the same period a year ago. Revenue rose 18 percent to $321.8 million. Lyn Kirby, Ulta chief executive said growth was strong in stores that have been open more than a year, a sign of robust organic growth.
Kirby said that the quarterly results included a 10.8 percent increase in comparable store sales, which came from an 8 percent rise in customer count and a 2.8 percent increase in the average amount they spent in the stories. On a two-year basis, comparable store sales grew 9.1 percent, an acceleration over the rate in the first quarter.
What especially cheered investors was the company’s positive outlook.
“We begin the third quarter with very strong momentum fueled by the continuation of our marketing, merchandising and stores expansion strategies,” Chief Operating Officer Chuck Rubin said in a statement. “During the third quarter we expect to continue to drive traffic and average ticket growth
Ulta, which competes against Sally Beauty Holdings Inc. and Regis Corp., predicted that third quarter earnings would come in between 20 cents to 22 cents a share on sales of $324 million to $330 million. Analysts were expecting 16 cents a share on revenue of $324.9 million, Reuters said.
