Ulta Beauty (NASDAQ: ULTA) and e.l.f. Beauty (NYSE:ELF) are both retail/wholesale companies, but which is the superior business? We will compare the two businesses based on the strength of their valuation, institutional ownership, dividends, risk, earnings, analyst recommendations and profitability.
Insider and Institutional Ownership
85.7% of Ulta Beauty shares are held by institutional investors. Comparatively, 96.9% of e.l.f. Beauty shares are held by institutional investors. 5.2% of Ulta Beauty shares are held by company insiders. Comparatively, 16.5% of e.l.f. Beauty shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.
Valuation & Earnings
This table compares Ulta Beauty and e.l.f. Beauty’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Ulta Beauty||$5.10 billion||2.97||$924.07 million||$7.12||34.30|
|e.l.f. Beauty||$249.18 million||4.26||$38.92 million||$0.20||115.05|
Ulta Beauty has higher revenue and earnings than e.l.f. Beauty. Ulta Beauty is trading at a lower price-to-earnings ratio than e.l.f. Beauty, indicating that it is currently the more affordable of the two stocks.
This is a summary of recent ratings for Ulta Beauty and e.l.f. Beauty, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Ulta Beauty currently has a consensus target price of $320.06, indicating a potential upside of 31.06%. e.l.f. Beauty has a consensus target price of $30.70, indicating a potential upside of 33.42%. Given e.l.f. Beauty’s stronger consensus rating and higher probable upside, analysts clearly believe e.l.f. Beauty is more favorable than Ulta Beauty.
This table compares Ulta Beauty and e.l.f. Beauty’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Ulta Beauty beats e.l.f. Beauty on 7 of the 13 factors compared between the two stocks.
Ulta Beauty Company Profile
Ulta Beauty, Inc. is a holding company for the Ulta Beauty group of companies. The Company is a beauty retailer. The Company offers cosmetics, fragrance, skin, hair care products and salon services. The Company offers approximately 20,000 products from over 500 beauty brands across all categories, including the Company’s own private label. The Company also offers a full-service salon in every store featuring hair, skin and brow services. The Company operates approximately 970 retail stores across over 48 states and the District of Columbia and also distributes its products through its Website, which includes a collection of tips, tutorials and social content. The Company offers makeup products, such as foundation, face powder, concealer, color correcting, face primer, blush, bronzer, contouring, highlighter, setting spray, shampoos, conditioners, hair styling products, hair styling tools and perfumes. The Company also offers makeup brushes and tools, and makeup bags and cases.
e.l.f. Beauty Company Profile
e.l.f. Beauty, Inc., formerly J.A. Cosmetics Holdings, Inc., is a cosmetic company. The Company conducts its business under the name e.l.f. Cosmetics, and offers products for eyes, lips and face to consumers through its retail customers, e.l.f. stores and e-commerce channels. The Company offers a range of products for eyes, such as eyeshadow, eyeliner, mascara and eyelashes, eyebrows, concealer and primer, brushes and tools, and sets and palettes. The Company offers lipstick, lip gloss, lipliner, and lip care and brushes. The Company launches its products on elfcosmetics.com, and distribution is generally only broadened to its retail customers after it receives consumer validation online. The Company sells its products in national and international retailers (with international primarily serviced by distributors) and direct-to-consumer channels. It sells its products in retail stores in the United States across mass, drug store, food and specialty retail channels.
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