This morning I had some room for another position in the Barchart Van Meerten New High portfolio so I used Barchart to screen for stocks trading over 100K shares a day that were having the most frequent number of new highs in the last month. Near the top of the list was Ulta Salon Cosmetics (ULTA) with 16 new highs and a price increase of 34.48% in the last month.
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Ulta, a beauty retailer, provides prestige, mass and salon products, and salon services in the United States. Its stores offer approximately 21,000 beauty products in various categories, which include cosmetics, such as products for the face, eyes, cheeks, lips and nails; haircare, including shampoos, conditioners, styling products, and hair accessories; salon styling tools comprising hair dryers, curling irons and flat irons; skincare and bath and body, such as products for the face, hands and body; fragrances for men and women; private label consisting of Ulta branded cosmetics, skincare, bath and body products, and haircare; and other products, including candles, home fragrance products, and other health and beauty products. As of January 29, 2011, the company operated 389 stores in 40 states. It also operates full-service salons in its stores. The company was founded in 1990 and is based in Bolingbrook, Illinois. (Yahoo Finance)
Factors to Consider
Barchart Technical Indicators
- 96% Barchart technical buy signal
- Trend Spotter buy signal
- Above its 20, 50 and 100 day moving averages
- Relative Strength Index of 73.99% and still rising
- Trades around 66.77 which is above its 50 day moving average of 56.31
- Sales increased 21% last year, 10% when measured on sale store sales.
- The company added 47 stores in 2010 and expects to add another 61 by the end of 2011.
- Wall Street brokerage analysts released three strong buy, three buy and four hold recommendations for clients.
- Sales are expected to increase by 18.00% this year and 16.70% next year.
- Earnings are projected to increase by 40.50% this year, another 25.20% next year and continue by 23.40% annually for the next five years.
General Investor Sentiment
- The 169 readers of Motley Fool that have rated this stock voted 87% that the stock will beat the market.
- The more experienced All Stars voted 91% for the same result.
Summary: Ulta was added to the Barchart Van Meerten New High portfolio based on its recent price momentum. The fact that analysts predict double digit growth in sales and earnings and that the Motley Fool All Stars give the stock a 91% endorsement to beat the market is just more icing on the cake.
Disclosure: I am long ULTA.