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Investing.com - DA Davidson has reiterated its Buy rating and $550.00 price target on Ulta Beauty (NASDAQ:ULTA), a company currently valued at $21.7 billion, following the company’s acquisition of Space NK from Manzanita Capital. According to InvestingPro data, Ulta maintains excellent financial health with strong market performance, delivering a 20% return over the past year.
Space NK operates 83 stores primarily in the United Kingdom (TADAWUL:4280) with additional locations in Ireland, along with boutique store-within-a-store setups in U.S. department stores including Bloomingdales and Nordstrom (NYSE:JWN), and in Hudson (NYSE:HUD) Bay in Canada. The company also maintains an e-commerce presence.
The acquisition aligns with Ulta’s previously announced international expansion plans, which is one of its four strategic priorities for 2025. Ulta had earlier announced plans to open stores in Mexico, Dubai, and Kuwait City through joint venture structures with local operators.
According to DA Davidson, the financial terms of the deal were not disclosed, and the acquisition is expected to have an immaterial impact on Ulta’s 2025 financial results. The purchase will be funded through cash on hand and Ulta’s existing credit line, with no impact on the company’s planned $900 million share buyback program for this year.
The analyst noted that while international moves add some risk, they also create growth opportunities, and this acquisition may give Ulta access to new brands such as Rare Beauty that Ulta stores do not currently carry. The move also represents new CEO Kecia Steelman, who assumed leadership in January, putting her mark on the company.
In other recent news, Ulta Beauty has acquired the British beauty retailer Space NK from Manzanita Capital, marking its first direct entry into the UK market. Although the financial terms of the transaction were not disclosed, sources suggest the deal could exceed £300 million ($380 million). Space NK will continue to operate as a standalone subsidiary under its current management team. This acquisition aligns with Ulta Beauty’s international expansion strategy, which includes initiatives in Mexico and the Middle East. In analyst updates, DA Davidson raised its price target for Ulta Beauty to $550 from $485, maintaining a Buy rating, citing improved product differentiation compared to competitors. Meanwhile, Citi reiterated a neutral rating with a $450 price target following the immediate departure of Ulta’s CFO, Paula Oyibo. William Blair also maintained a Market Perform rating, highlighting limited upside potential as shares near the higher end of their trading range. These developments reflect Ulta Beauty’s ongoing strategic moves and analyst perspectives in the competitive beauty retail market.
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