Ulta Stock Moves Lower on New Coronavirus Measures

The beauty retailer's distribution center employees will receive a pay raise

Digital Content Manager
Mar 30, 2020 at 10:29 AM
facebook twitter linkedin

Cosmetics retailer Ulta Beauty Inc (NASDAQ:ULTA) is in the spotlight today after announcing the temporary closure of all its stores until further notice. The company said that its employees will continue to receive benefits, and will be paid until mid-April. Ulta added that it will continue to operate online and plans on giving its distribution center workers a $2-an-hour pay raise. In response, the stock is down 1% at $172.76. 

Last week, ULTA took cues from the broad market, surging back above the $200 region mid-week, before running out of steam near its descending 20-day moving average and eventually pivoting lower on Friday. For the year, ULTA is off roughly 30%. 

Most of the analysts covering Ulta are still optimistic on the retailer. Twelve consider the stock a "strong buy," compared to nine that say "hold." Plus, the consensus 12-month price target of $237.26 is a healthy 38.7% premium to current levels. 

Options traders on the other hand, have taken an extremely bearish stance. This is per ULTA's 10-day put/call volume ratio of 3.88 at the the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which sits higher than all but 1% of readings from the past year. This suggests a much heavier appetite than usual for long puts of late. 


Minimize Risk While Maximizing Profits

There is no options strategy like this one, which consistently minimizes risk while maintaining maximum profits. Perfect for traders looking for ways to control risk, reduce losses, and increase the likelihood of success when trading calls and puts. The Schaeffer’s team has over 41 years of options trading success targeting +100% gains on every trade. Rest assured your losses are effectively limited to your initial cost at the time of making your move! Don't waste another second... join us right now before the next trade is released! 



Special Offers from Schaeffer's Trading Partners