Specialty Retail Stocks Q2 In Review: Ulta (NASDAQ:ULTA) Vs Peers
Quarterly earnings results are a good time to check in on a company’s progress, especially compared to other peers in the same sector. Today we are looking at Ulta (NASDAQ:ULTA), and the best and worst performers in the specialty retail group.
Some retailers try to sell everything under the sun, while others—appropriately called Specialty Retailers—focus on selling a narrow category and aiming to be exceptional at it. Whether it’s eyeglasses, sporting goods, or beauty and cosmetics, these stores win with depth of product in their category as well as in-store expertise and guidance for shoppers who need it. E-commerce competition exists and waning retail foot traffic impacts these retailers, but the magnitude of the headwinds depends on what they sell and what extra value they provide in their stores.
The 7 specialty retail stocks we track reported a weaker Q2; on average, revenues were in line with analyst consensus estimates, while on average next quarter revenue guidance was 15.5% under consensus. Tech stocks have been hit the hardest as investors start to value profits over growth and specialty retail stocks have not been spared, with share prices down 11.7% since the previous earnings results, on average.
Offering high-end prestige brands as well as lower-priced, mass-market ones, Ulta Beauty (NASDAQ:ULTA) is an American retailer that sells makeup, skincare, haircare, and fragrance products.
Ulta reported revenues of $2.53 billion, up 10.1% year on year, beating analyst expectations by 1.28%. It was a good quarter for the company, with revenue and EPS exceeding analysts' estimates, driven by outperformance in same-store sales growth.
Ulta scored the fastest revenue growth and highest full year guidance raise of the whole group. The stock is down 5.87% since the results and currently trades at $398.
Is now the time to buy Ulta? Access our full analysis of the earnings results here, it's free.
Best Q2: GameStop (NYSE:GME)
Drawing gaming fans with demo units set up with the latest releases, GameStop (NYSE:GME) sells new and used video games, consoles, and accessories, as well as pop culture merchandise.
GameStop reported revenues of $1.16 billion, up 2.45% year on year, beating analyst expectations by 1.97%. It was a decent quarter for the company, with revenue and EPS exceeding Wall Street's expectations.
GameStop achieved the strongest analyst estimates beat among its peers. The stock is down 8.68% since the results and currently trades at $17.14.
Is now the time to buy GameStop? Access our full analysis of the earnings results here, it's free.
Weakest Q2: Sportsman's Warehouse (NASDAQ:SPWH)
A go-to destination for individuals passionate about hunting, fishing, camping, hiking, shooting sports, and more, Sportsman's Warehouse (NASDAQ:SPWH) is an American specialty retailer offering a diverse range of active gear, equipment, and apparel.
Sportsman's Warehouse reported revenues of $309.5 million, down 11.8% year on year, missing analyst expectations by 5.06%. It was a weak quarter for the company, with revenue and EPS coming in below Wall Street's estimates. Its full-year revenue guidance also came in significantly below analysts' expectations.
Sportsman's Warehouse had the weakest performance against analyst estimates and slowest revenue growth in the group. The stock is down 24.1% since the results and currently trades at $3.43.
Bath and Body Works (NYSE:BBWI)
Spun off from L Brands in 2020, Bath & Body Works (NYSE:BBWI) is a personal care and home fragrance retailer where consumers can find specialty shower gels, scented candles for the home, and lotions.
Bath and Body Works reported revenues of $1.56 billion, down 3.65% year on year, missing analyst expectations by 0.3%. It was a decent quarter for the company, with EPS coming in ahead of expectations and next quarter's earnings guidance also exceeding Wall Street's estimates.
The stock is down 5.32% since the results and currently trades at $33.1.
Sally Beauty (NYSE:SBH)
Catering to both everyday consumers as well as salon professionals, Sally Beauty (NYSE:SBH) is a retailer that sells salon-quality beauty products such as makeup and haircare products.
Sally Beauty reported revenues of $931 million, down 3.17% year on year, missing analyst expectations by 1.68%. It was a weak quarter for the company, with same store sales, revenue, and EPS all missing Wall Street analysts' expectations. On a positive note, Sally Beauty revised its full year adjusted operating margin guidance to the high end of previous guidance.
The stock is down 29.6% since the results and currently trades at $8.34.
The author has no position in any of the stocks mentioned