Is Ulta Beauty Positioned for a Beat in Its Q2 Earnings Release?

Ulta Beauty, Inc. ULTA is likely to witness top- and bottom-line growth when it reports second-quarter fiscal 2026 earnings on Aug. 27. The Zacks Consensus Estimate for revenues is pegged at $2.97 billion, indicating an increase of 6.5% from the year-ago reported number. 

The consensus mark for earnings has risen 0.5% over the past seven days to $6.20 a share, which suggests a jump of 7.3% from the figure reported in the year-ago period. ULTA has a trailing four-quarter surprise of nearly 10%, on average.

Factors Likely to Influence ULTA’s Upcoming Results

Ulta Beauty’s second-quarter performance is likely to have benefited from continued healthy engagement in beauty and wellness, supported by its broad mass-to-luxury assortment. The company entered the quarter focused on driving traffic and conversion through guest service, in-store events, loyalty and personalized marketing while emphasizing brand building, exclusivity and wellness.

Digital momentum may also have supported sales. Ongoing enhancements, including expanded same-day delivery, Buy Now, Pay Later and omnichannel fulfillment options, are aimed at improving convenience and the guest experience. The recently launched TikTok Shop also provides an additional discovery channel, particularly for younger consumers.

The Space NK acquisition is likely to have supported Ulta Beauty’s top-line growth, as the company expects first-half sales to benefit from the acquisition. Profitability may also have received support from inventory productivity, supply-chain efficiencies and shrink improvement. 

However, macroeconomic uncertainty, increasingly value-focused consumers, higher fuel costs and intense competition in the beauty market may have limited sales and margin expansion. Although Space NK is expected to contribute to revenues, the acquisition, together with ongoing strategic investments, is also likely to have kept first-half SG&A expenses elevated.

Earnings Whispers for ULTA

Our proven model predicts an earnings beat for Ulta Beauty this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is exactly the case here.

Ulta Beauty currently carries a Zacks Rank #3 and has an Earnings ESP of +0.10%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Other Stocks With the Favorable Combination

Here are some other companies worth considering, as our model shows that these, too, have the right combination of elements to beat on earnings this reporting cycle.

Burlington Stores, Inc. BURL currently has an Earnings ESP of +1.84% and a Zacks Rank of 3. The consensus estimate for the quarterly revenues is pinned at approximately $3 billion, which indicates around 12% growth from the figure reported in the prior-year quarter. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Burlington’s upcoming quarter’s EPS is pegged at $2.18, which implies 37.1% growth year over year. BURL delivered a trailing four-quarter earnings surprise of 14%, on average.

Dollar Tree, Inc. DLTR currently has an Earnings ESP of +0.98% and a Zacks Rank of 3. The consensus estimate for Dollar Tree’s quarterly revenues is pinned at $4.9 billion, which implies 6.2% growth from the figure reported in the prior-year quarter. 

The Zacks Consensus Estimate for the upcoming quarter’s EPS is pegged at $1.12, which indicates a 45.4% increase year over year. DLTR delivered a trailing four-quarter earnings surprise of roughly 32.1%, on average.

Costco Wholesale Corporation COST currently has an Earnings ESP of +1.45% and a Zacks Rank of 3. The Zacks Consensus Estimate for quarterly revenues is pegged at $94.5 billion, which calls for a jump of 9.6% from the figure reported in the prior-year quarter. 

The Zacks Consensus Estimate for Costco’s upcoming quarter EPS is pegged at $6.51, implying 10.9% year-over-year growth. COST has a trailing four-quarter earnings surprise of 1%, on average.

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This article originally published on Zacks Investment Research (zacks.com).

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