Ulta Salon, Cosmetics & Fragrance joins the S&P 500
Known on the NASDAQ exchange simply as Ulta, the company is replacing Tenet Healthcare on the widely regarded list (Tenet is moving down to the S&P MidCap 400).
On the index, Ulta will be categorized as a Consumer Discretionary business (in the Global Industry Classification Standard) and a Specialty Store (in the Sub-Industry index).
In good standing
Being added to list often gives companies a financial lift and certainly adds to their reputation.
Ulta has been growing steadily and strategically for some time. At the start of the year, the company’s retail presence comprised close to 900 stores in 48 states. The stores carry Ulta’s own private label products along with 20,000+ beauty items from more than 500 other brands.
The company’s recent Q4 results show a total sales increase of 21.1% and project an 18% to 20% earnings per share growth this year.
“Our fourth quarter results capped an exceptional year during which we made significant progress against our strategic imperatives, while achieving outstanding sales and earnings growth. We continue to benefit from the powerful combination of strong demand in the beauty category and Ulta Beauty’s highly differentiated offering that propels our business to transcend prevailing trends across the retail landscape,” says Mary Dillon, chief executive officer of Ulta, in the company press release outlining the results.
Gaining prominence
Earlier this month, Ulta announced plans to open satellite headquarter offices in downtown Chicago, Illinois.
The company’s primary headquarters are in the city suburb of Bolingbrook. These new offices are intended to help attract top talent to the company and give current employees the opportunity to meet business partners in a more convenient location. The city site has the added benefit of transit and an active downtown.
Market matters
This industry full well knows that financial market indicators are far from arbitrary. And of course, investors put tremendous faith the rankings: “With over 1,000,000 indices covering a wide range of asset classes across the globe, S&P Dow Jones Indices LLC defines the way investors measure and trade the markets,” boasts the company in its press release announcing the news about Ulta.
Just over one year ago, Avon lost its spot on the S&P 500. Since then the company has privatized its North American business through a deal with Cerberus Capital Management, a move meant to return the company to profitability. “Our goal is to make the direct-selling model and the Representative experience more contemporary, efficient, and profitable by reinvigorating the Avon brand, improving New Avon LLC's competitiveness, and positioning it for long-term, sustainable growth,” said Steven F. Mayer, senior managing director and co-head of global private equity for Cerberus, when the deal was finalized.
