DCF Studio

    ULTA · NMS · Consumer Cyclical

    Ulta Beauty, Inc.

    Also onShortfallConsensus DriftCrosscheck

    Implied value per share

    USD 563.87

    Market price

    USD 637.57

    Implied upside

    -11.6%

    10-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case · Price 2026-11-02 · Accounts to 2026-01-31

    AdjustedCapital expenditure runs at 3.4% of revenue against depreciation of 2.3%. A perpetuity has to be a steady state, so the forecast tapers capex to maintenance at depreciation plus the reinvestment terminal growth requires (g/ROIC of NOPAT), and the terminal year carries on from there. The bridge is shown under Terminal Value.

    Value Per Share

    Perpetuity growth
    USD 563.87-11.6%
    Exit multiple
    USD 706.33+10.8%
    Market price
    USD 637.57

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    0bn1bn2bnFY27FY28FY29FY30FY31FY32FY33FY34FY35FY36
    Nominal FCFFDiscounted to todayUSD
    LineFY27FY28FY29FY30FY31FY32FY33FY34FY35FY36CAGR
    RevenueUSD 13.3bnUSD 14.0bnUSD 14.6bnUSD 15.3bnUSD 15.9bnUSD 16.5bnUSD 17.1bnUSD 17.7bnUSD 18.2bnUSD 18.6bn+3.8%
    EBITUSD 1.9bnUSD 2.0bnUSD 2.1bnUSD 2.2bnUSD 2.3bnUSD 2.4bnUSD 2.5bnUSD 2.5bnUSD 2.6bnUSD 2.7bn+3.8%
    NOPATUSD 1.5bnUSD 1.6bnUSD 1.7bnUSD 1.7bnUSD 1.8bnUSD 1.9bnUSD 2.0bnUSD 2.0bnUSD 2.1bnUSD 2.1bn+3.8%
    Add depreciation & amortisationUSD 309.7mUSD 325.7mUSD 341.4mUSD 356.8mUSD 371.6mUSD 385.9mUSD 399.4mUSD 412.0mUSD 423.7mUSD 434.3m+3.8%
    Less capital expenditureUSD -456.9mUSD -471.4mUSD -484.7mUSD -496.6mUSD -506.9mUSD -515.6mUSD -522.5mUSD -527.6mUSD -530.8mUSD -532.0m+1.7%
    Capex, % of revenue3.4%3.4%3.3%3.2%3.2%3.1%3.1%3.0%2.9%2.9%-
    Less increase in working capitalUSD -107.5mUSD -83.5mUSD -82.2mUSD -80.2mUSD -77.6mUSD -74.4mUSD -70.5mUSD -66.0mUSD -60.9mUSD -55.3m-7.1%
    Free cashflow to firmUSD 1.3bnUSD 1.4bnUSD 1.4bnUSD 1.5bnUSD 1.6bnUSD 1.7bnUSD 1.8bnUSD 1.8bnUSD 1.9bnUSD 2.0bn+5.1%
    Discount factor0.96040.88570.81690.75340.69490.64090.59100.54510.50280.4637-
    Present valueUSD 1.2bnUSD 1.2bnUSD 1.2bnUSD 1.1bnUSD 1.1bnUSD 1.1bnUSD 1.0bnUSD 997.8mUSD 955.7mUSD 912.4m-
    Present Value Of The ForecastUSD 10.8bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.89%US 10-year Treasury (^TNX), 2026-11-02
    Equity risk premium4.23%Damodaran, January 2026
    Beta0.891Reported 0.838, pulled toward 1.0 (Blume)
    Cost of equity8.66%Risk-free + beta x equity risk premium
    Cost of debt6.89%Assumed: risk-free + 200bp (interest expense not reported)
    Market capitalisationUSD 27.3bn92.6% of capital
    Total debtUSD 2.2bn7.4% of capital, book value as a proxy
    Tax rate21.0%Effective, capped at statutory
    WACC8.43%E/V x Re + D/V x Rd x (1 - t)

    Terminal Value

    Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

    Perpetuity growth at 2.50%

    Value per shareUSD 563.87

    60% of EV

    Forecast FCFF, final year
    USD 2.0bn
    Capex at depreciation, working capital in reinvestment
    USD 2.1bn
    Less reinvestment at g/ROIC (4.6% of NOPAT)
    USD -97.7m
    Capitalised
    USD 2.0bn
    ROIC (reported)
    54.3%
    Terminal value, undiscounted
    USD 35.0bn
    Terminal value, discounted
    USD 16.2bn
    Enterprise value
    USD 27.1bn
    Less net debt
    USD 1.7bn
    Equity value
    USD 25.4bn

    Exit at 15.7x EBITDA

    Value per shareUSD 706.33

    68% of EV

    Terminal value, undiscounted
    USD 48.8bn
    Terminal value, discounted
    USD 22.6bn
    Enterprise value
    USD 33.5bn
    Less net debt
    USD 1.7bn
    Equity value
    USD 31.8bn

    Spread between methods: 22%.

    Sensitivity

    Value per share (USD) by discount rate and long-run growth.

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    6.43%751.05806.10875.45965.351086.33
    7.43%614.10647.50687.88737.62800.29
    8.43%517.01538.54563.87594.04630.53
    9.43%444.68459.16475.86495.30518.18
    10.43%388.77398.81410.22423.29438.36

    Outlined: this model. Green text: above today's price of 637.57. Shading: distance from this model's own value.

    Priced In

    What each input would have to be to justify the current price, one at a time.

    InputActualModelImplied
    Revenue growth, a year6.7%4.2%5.6%
    EBIT margin16.2%14.4%16.1%
    Discount rate-8.4%7.8%
    Download as Excel

    Live formulas, not pasted numbers - edit a driver and the workbook reprices.

    Yahoo Finance and RBA data. General information, not advice. Methodology.