Hundreds of Target Stores will soon have Ultra Beauty makeup and skin products shops inside their premises across the US. Each shop will be around 1000 square feet. Target employees will be trained as beauty consultants by Ultra Beauty will run these shops. This deal announced on Tuesday has been facilitated due to the pandemic.
Ultra shares rose by about 8% on Tuesday in premarket trading. Target shares also gained by 1% after the news was announced. Ulta Beauty, Inc. (ULTA) Nasdaq shares It’s a strategic move that will get customers to buy more items when in the store. Partnering up with Target proves to be a win for Ulta. I will help them prevent from having to close stores, Improving cash flow.
Many product lines sold at Ulta will also be available on the target website as well as in the store. The Ulta locations in Target will occupy approximately 1000 square feet of hair care products cosmetics, and fragrances. Delivery is available for the product’s just as all other products at Target will be including curbside pickup. Ulta will be training target employees as beauty consultants.
Target’s profits increased 80% in 2020’s second quarter compared to a year prior. Target had the advantage of being an essential store to stay open during the COVID-19 pandemic. Consumers were able to go in and not only buy food but personal items, decor items, and pick up medications from the pharmacy. Target Corp (TGT) proved to be the perfect one stop shop during the Coronavirus pandemic and still continues to do so.
Trend Analysis- ULTA
ULTA is showing strength within a longer-term bearish trend. Its MACD is above the signal line and shares are presently 20.5% above the 200-day moving average. However, that moving average is declining, implying that caution is still warranted. Comparative Relative Strength analysis shows that this issue is lagging the S&P 500.As of 12:26 PM ET Tuesday, 11/10/2020
Source : Charles Schwab/Research
Momentum for ULTA is strongly bullish. The 14-period Slow Stochastic Oscillator is rising, as investors pay higher prices for shares. Source : Charles Schwab/Research
Both the companies will gain a larger number of customers. Target will get unique traffic and expand its reach in a different set and type of customer while Ultra will increase visibility, especially on store shelves and on the Target website which has a wider reach due to the pandemic.
Ulta Beauty CEO Mary Dillon said that retailers “are embracing a time of change to innovate and to lead.” She declined to share the length or financial details but said that they would expand the Ultra footprint across hundreds of Target stores over a period of time.
Cornell said that Target’s deal with Ultra will “build momentum we have in the category and investments we’ve been making for years in beauty. ”Cornell and Dillon said that both the companies are working together to choose the stores that will get the shops initially and to curate the brands and products that will be featured initially.
Trend Analysis- TARGET
TGT appears to be correcting within a longer-term bullish trend. Although its MACD is presently below the signal line, shares remain 24.5% above an upwards sloping 200-day moving average. Comparative Relative Strength analysis shows that this issue is lagging the S&P 500.Source : Charles Schwab/Research
Momentum for TGT is improving. The 14-period Slow Stochastic Oscillator is rising as investors begin to purchase shares. Source : Charles Schwab/Research