#6 - Ulta Beauty (NASDAQ:ULTA)
Supply chains are likely to change as a result of the coronavirus. Businesses are realizing that a “just in time” inventory strategy is compromised when the company that dominates your supply chain is under quarantine.
Nobody is saying that China will not have a significant role to play in the post-coronavirus economy. However, it’s likely that their role may become a bit more muted as companies look to take more control of where their products come from. And that’s one reason to consider Ulta Beauty (NASDAQ:ULTA). The company’s supply chain is largely based in the United States. Not only does that mean it should be able to get up to speed quickly after the coronavirus threat subsides, but it will also not have to make adjustments to its supply chain.
Ulta may also benefit from the inevitable increase in online shopping. The beauty category as a whole saw just 11% of its sales generated online. Ulta’s own numbers closely approximate that (around 12%-13%). However, that number is likely to go up as more consumers have no choice but to have products, such as cosmetics, delivered. I can see Ulta taking an approach like Stitch Fix (SFIX) where consumers could “try before they buy”.
About Ulta Beauty
Ulta Beauty, Inc operates as a specialty beauty retailer in the United States. The company offers branded and private label beauty products, including cosmetics, fragrance, haircare, skincare, bath and body products, professional hair products, and salon styling tools through its Ulta Beauty stores, shop-in-shops, Ulta.com website, and its mobile applications.
Read More - Current Price
- $353.35
- Consensus Rating
- Hold
- Ratings Breakdown
- 12 Buy Ratings, 10 Hold Ratings, 2 Sell Ratings.
- Consensus Price Target
- $420.71 (19.1% Upside)
