Ulta Beauty (ULTA) and Sally Beauty (SBH) Upgraded Amid Growth Expectations for 2026
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jan 21 2026
0mins
Source: seekingalpha
- Market Challenges and Opportunities: The beauty, personal care, and household products sector faces slowing global consumption and structural tariff pressures in 2026, yet restructuring initiatives launched in 2025 are expected to yield positive impacts, helping companies navigate market challenges.
- Rating Upgrades: Raymond James analyst Olivia Tong upgraded Ulta Beauty (ULTA) from Outperform to Strong Buy, anticipating outsized growth in 2026, reflecting the company's success in attracting younger consumers and its effective loyalty programs.
- Sally Beauty's Growth Potential: Tong raised Sally Beauty Holdings (SBH) from Market Perform to Outperform, believing that the 'Sally Ignited' store refresh and partnerships with DoorDash and Uber Eats will enhance customer convenience and drive sales growth.
- Price Target Increases: Tong raised Ulta's price target by 31% to $790 and set a $19 target for Sally Beauty, reflecting optimism about both companies' future growth potential, contributing to their stock prices reaching multi-year highs.
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Analyst Views on SBH
Wall Street analysts forecast SBH stock price to rise
4 Analyst Rating
2 Buy
1 Hold
1 Sell
Hold
Current: 11.830
Low
13.00
Averages
15.88
High
19.00
Current: 11.830
Low
13.00
Averages
15.88
High
19.00
About SBH
Sally Beauty Holdings, Inc. is an international specialty retailer and distributor of professional beauty supplies. The Company offers professional hair color, sells and distributes professional beauty supplies globally through its Sally Beauty and Beauty Systems Group segments. Sally is a domestic and international chain of retail stores and digital platforms that offers professional beauty supplies to both salon professionals and retail customers primarily in North America, parts of Europe and South America. Sally Beauty stores offer up to 7,000 products for hair color, hair care, nails, and skin care through proprietary brands, such as Ion, Bondbar, Strawberry Leopard, and Generic Value Products. Beauty Systems Group stores, branded as Cosmo Prof or Armstrong McCall stores, along with its outside sales consultants, sell up to 8,000 professionally branded products, including Paul Mitchell, Wella, Matrix, Schwarzkopf, Kenra, Goldwell, Joico, Amika and Moroccanoil.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Adjusted Earnings: Excluding items, Sally Beauty reported adjusted earnings of $43.524 million, or $0.44 per share, indicating the sustained profitability of its core business and a healthy financial position.
- Revenue Increase: The company's revenue rose 2.3% year-over-year to $903.382 million from $883.146 million last year, demonstrating stable market demand and the effectiveness of the company's sales strategies.
- Market Impact: The growth in both profit and revenue not only boosts investor confidence but also potentially provides funding for future expansions and investments, further solidifying its market position in the beauty industry.
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- Historical Performance Review: Over the past two years, SBH has beaten EPS estimates 75% of the time and revenue estimates 50% of the time, indicating a level of stability in profitability despite market challenges.
- Estimate Revision Dynamics: In the last three months, there have been no upward revisions to EPS estimates and five downward revisions, while revenue estimates saw three upward revisions, reflecting market divergence regarding the company's future performance, which could impact investor confidence.
- Executive Changes: Sally Beauty appointed Adrianne Lee as CFO, which may bring new financial strategies and management efficiencies, potentially enhancing the company's performance in the highly competitive beauty industry.
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- Webcast Access: Investors can access the live webcast through the Investor Relations section of the company's website or a third-party host, ensuring broad participation and information dissemination, thereby enhancing interaction between the company and its investors.
- Pre-registration Process: Participants can pre-register via the provided link to receive a dial-in number and unique PIN, with pre-registration available before and after the call start time, facilitating greater investor engagement.
- Replay Availability: For those unable to attend the live call, a replay will be available on the company's investor relations website after 10:00 a.m. Central Time on May 11, 2026, until May 11, 2027, ensuring accessibility of information.
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- Increased Consumer Spending Expectations: With more cash in consumers' pockets, investors anticipate a rise in spending on non-essential goods, especially in apparel and home electronics, which will further drive sales growth and market share for retailers.
- Supply Chain Stability Enhanced: The de-escalation of conflict stabilizes global supply chains, easing the
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- Upgraded Performance Outlook: The company outlines plans to expand its fragrance business to 2,000 stores and raises its 2026 EPS guidance, showcasing a proactive response to market demand and a strategic focus on business growth.
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- Profit Growth: Sally Beauty's second-quarter profit reached $42.695 million, translating to earnings per share of $0.43, which marks a significant increase from last year's $39.210 million and $0.38 per share, reflecting the company's robust market performance.
- Adjusted Earnings: Excluding items, Sally Beauty reported adjusted earnings of $43.524 million, or $0.44 per share, indicating the sustained profitability of its core business and a healthy financial position.
- Revenue Increase: The company's revenue rose 2.3% year-over-year to $903.382 million from $883.146 million last year, demonstrating stable market demand and the effectiveness of the company's sales strategies.
- Market Impact: The growth in both profit and revenue not only boosts investor confidence but also potentially provides funding for future expansions and investments, further solidifying its market position in the beauty industry.
See More
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- Earnings Announcement Date: Sally Beauty (SBH) is set to release its Q2 earnings on May 11 before market open, with consensus EPS estimate at $0.41, reflecting a 2.4% year-over-year decline, while revenue is projected at $902.37 million, indicating a modest 2.2% increase, suggesting slight improvement in revenue growth.
- Historical Performance Review: Over the past two years, SBH has beaten EPS estimates 75% of the time and revenue estimates 50% of the time, indicating a level of stability in profitability despite market challenges.
- Estimate Revision Dynamics: In the last three months, there have been no upward revisions to EPS estimates and five downward revisions, while revenue estimates saw three upward revisions, reflecting market divergence regarding the company's future performance, which could impact investor confidence.
- Executive Changes: Sally Beauty appointed Adrianne Lee as CFO, which may bring new financial strategies and management efficiencies, potentially enhancing the company's performance in the highly competitive beauty industry.
See More
Sally Beauty to Host Q2 Earnings Call on May 11, 2026
- Earnings Call Schedule: Sally Beauty Holdings will host its second quarter earnings call on May 11, 2026, at 7:30 a.m. Central Time, discussing financial results and trends, with a press release expected prior to the call to enhance investor transparency.
- Webcast Access: Investors can access the live webcast through the Investor Relations section of the company's website or a third-party host, ensuring broad participation and information dissemination, thereby enhancing interaction between the company and its investors.
- Pre-registration Process: Participants can pre-register via the provided link to receive a dial-in number and unique PIN, with pre-registration available before and after the call start time, facilitating greater investor engagement.
- Replay Availability: For those unable to attend the live call, a replay will be available on the company's investor relations website after 10:00 a.m. Central Time on May 11, 2026, until May 11, 2027, ensuring accessibility of information.
See More
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- Energy Crisis Threat Reduced: The reopening of the Strait of Hormuz significantly mitigates the risk of a global energy crisis, leading to a surge in several stocks during the afternoon session, particularly benefiting the retail sector as lower oil prices decrease transportation costs, directly enhancing net margins.
- Increased Consumer Spending Expectations: With more cash in consumers' pockets, investors anticipate a rise in spending on non-essential goods, especially in apparel and home electronics, which will further drive sales growth and market share for retailers.
- Supply Chain Stability Enhanced: The de-escalation of conflict stabilizes global supply chains, easing the
See More
Sally Beauty Appoints New CFO
- Executive Change: Sally Beauty announced the appointment of Adrianne Lee as Senior VP and CFO effective April 28, 2026, succeeding Marlo Cormier, who will leave the company on April 11, 2026, to pursue other opportunities, indicating a strategic shift in the executive team.
- Relevant Experience: Ms. Lee brings significant relevant experience to her new role, having previously served as President and CFO at Bed Bath & Beyond, which is expected to provide crucial support for Sally Beauty's financial management and strategic development.
- Ongoing Stock Buybacks: Sally Beauty continues its stock buyback program, reflecting the company's efforts to enhance operational efficiency and shareholder value, demonstrating management's confidence in future growth prospects.
- Upgraded Performance Outlook: The company outlines plans to expand its fragrance business to 2,000 stores and raises its 2026 EPS guidance, showcasing a proactive response to market demand and a strategic focus on business growth.
See More
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- Oil Price Volatility: Trump's announcement to pause strikes on Iranian energy infrastructure has led to a 2% rise in U.S. stock futures and over a 9% drop in international oil prices, which could have significant implications for investor confidence in the energy sector.
- Microsoft Crisis Deepens: Analysts suggest that Microsoft's reorganization of Copilot and potential lawsuits against OpenAI and Amazon indicate major challenges for the company, as customer demand shifts towards AI tools, potentially impacting future revenue streams.
- Darden Restaurants Price Target Raised: Bank of America has increased its price target for Darden Restaurants from $262 to $272, reflecting strong market confidence in its brands like Olive Garden, which may attract more investor interest.
- Elliott Management Targets Synopsys: Activist investor Elliott holds a multibillion-dollar stake in Synopsys, aiming to enhance its financial performance, resulting in a more than 4% increase in share price, indicating market recognition of its potential value.
See More
