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BOLINGBROOK, Ill. - Ulta Beauty, Inc. (NASDAQ:ULTA), the $21.4 billion beauty retail giant currently trading near its InvestingPro Fair Value, has acquired British beauty retailer Space NK Limited from Manzanita Capital, the company announced Thursday. Financial terms of the transaction were not disclosed.
Space NK, which operates 83 stores across the UK and Ireland along with an online platform, will function as a standalone subsidiary of Ulta Beauty while maintaining its existing management team led by CEO Andy Lightfoot. The acquisition comes as Ulta Beauty demonstrates strong financial health, with InvestingPro data showing liquid assets exceeding short-term obligations and a robust current ratio of 1.67.
"We are excited to enter the UK market via the Space NK banner," said Kecia Steelman, president and chief executive officer of Ulta Beauty. "International expansion is an integral part of our Ulta Beauty Unleashed plan."
The acquisition represents Ulta’s first direct entry into the UK beauty market. Space NK, founded in 1993 in London’s Covent Garden, has established itself as a destination for beauty discovery, specializing in curating innovative beauty brands.
Ulta Beauty funded the purchase with cash on hand and existing credit facility capacity. The company, which has delivered an impressive 20% return over the past year, stated the acquisition is not expected to materially impact its fiscal 2025 financial results or affect its capital allocation priorities, including its share repurchase program. For deeper insights into Ulta Beauty’s financial health and growth potential, investors can access comprehensive analysis through InvestingPro’s detailed research reports.
"We have long respected Ulta Beauty as the leading specialty beauty retailer in the U.S.," said Lightfoot. "We are energized by the opportunity to join Ulta Beauty and benefit from its scale, brand relationships and resources."
Bill Fisher, CEO and founder of Manzanita Capital, which owned Space NK for 23 years, expressed confidence that "Ulta Beauty and this terrific management team will take Space NK to new heights."
The acquisition aligns with Ulta Beauty’s international expansion strategy, which includes initiatives in Mexico and the Middle East, according to the company’s press release statement.
In other recent news, Ulta Beauty is reportedly set to acquire the UK beauty chain Space NK in a deal valued at over £300 million, enhancing its presence in the UK market. DA Davidson has increased its price target for Ulta Beauty to $550, maintaining a Buy rating, citing improved product differentiation compared to competitors. Meanwhile, Citi has reiterated its neutral rating on Ulta Beauty following the departure of CFO Paula Oyibo, with Chris Lialios stepping in as interim CFO. Ulta Beauty management continues to uphold its fiscal 2025 guidance amidst this transition. William Blair has maintained a Market Perform rating, noting limited upside potential due to current valuation levels and potential margin challenges. BofA Securities has raised its price target for Ulta Beauty to $500, maintaining a Neutral rating, while highlighting potential margin pressure in the second half of the fiscal year. These developments reflect a mix of strategic expansion and cautious financial projections for Ulta Beauty.
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