Ulta Beauty Inc (ULTA)

Activity ratios

Short-term

Turnover ratios

Feb 3, 2024 Oct 28, 2023 Jul 29, 2023 Apr 29, 2023 Jan 28, 2023 Oct 29, 2022 Jul 30, 2022 Apr 30, 2022 Jan 29, 2022 Oct 30, 2021 Jul 31, 2021 May 1, 2021 Jan 30, 2021 Oct 31, 2020 Aug 1, 2020 May 2, 2020 Feb 1, 2020 Nov 2, 2019 Aug 3, 2019 May 4, 2019
Inventory turnover 4.02 2.85 3.58 3.62 3.94 2.77 3.41 3.49 3.57 2.60 3.32 3.34 3.77 2.97 3.16 3.35 3.65 2.85 3.44 3.54
Receivables turnover 53.90 53.63 61.51 55.17 51.19 48.48 51.90 46.89 36.93 47.87 49.58 44.82 31.86 45.93 49.92 76.99 53.09 63.93 66.14 62.85
Payables turnover 12.55 11.09 12.48 10.20 11.02 9.04 9.68 9.36 9.52 6.67 8.95 8.17 8.81 8.93 10.87 9.63 11.39 7.73 10.07 10.86
Working capital turnover 9.51 11.39 10.44 9.98 9.94 9.27 9.96 9.70 11.93 6.70 6.88 6.64 5.25 6.17 3.68 4.18 8.06 8.59 8.29 7.10

Ulta Beauty Inc's activity ratios provide insights into the efficiency of the company's operations in managing its assets and liabilities.

1. Inventory turnover: The company's inventory turnover ratio has been relatively stable over the past few quarters, averaging around 3.5. This suggests that Ulta Beauty is able to sell and replace its inventory approximately 3 to 4 times a year, indicating a moderate efficiency in managing its inventory levels.

2. Receivables turnover: Ulta Beauty's receivables turnover ratio has been consistently high, indicating that the company efficiently collects payments from its customers. The average turnover of around 50 to 60 times per year suggests that Ulta Beauty has effective credit policies and a strong accounts receivable management process in place.

3. Payables turnover: The payables turnover ratio for Ulta Beauty has also been relatively stable, ranging from 8 to 12 times per year. This indicates that the company efficiently manages its accounts payable, settling its debts in a timely manner. A higher turnover ratio suggests that Ulta Beauty maintains good relationships with its suppliers and manages its trade credit effectively.

4. Working capital turnover: Ulta Beauty's working capital turnover has shown fluctuations but generally remains at a healthy level, averaging around 9 to 10 times per year. This ratio reflects the company's ability to generate sales from its working capital investment, indicating efficient utilization of resources. A higher turnover implies that Ulta Beauty is efficient in utilizing its current assets to drive revenue.

Overall, Ulta Beauty Inc's activity ratios suggest that the company is effectively managing its assets and liabilities to support its operational activities. Efficient inventory management, strong receivables collection, and effective working capital utilization indicate a well-run business in terms of operational efficiency.


Average number of days

Feb 3, 2024 Oct 28, 2023 Jul 29, 2023 Apr 29, 2023 Jan 28, 2023 Oct 29, 2022 Jul 30, 2022 Apr 30, 2022 Jan 29, 2022 Oct 30, 2021 Jul 31, 2021 May 1, 2021 Jan 30, 2021 Oct 31, 2020 Aug 1, 2020 May 2, 2020 Feb 1, 2020 Nov 2, 2019 Aug 3, 2019 May 4, 2019
Days of inventory on hand (DOH) days 90.73 127.86 101.86 100.84 92.61 131.90 107.03 104.56 102.12 140.23 110.05 109.35 96.87 122.90 115.45 109.02 100.11 128.25 106.02 103.17
Days of sales outstanding (DSO) days 6.77 6.81 5.93 6.62 7.13 7.53 7.03 7.78 9.88 7.62 7.36 8.14 11.46 7.95 7.31 4.74 6.87 5.71 5.52 5.81
Number of days of payables days 29.09 32.90 29.25 35.78 33.13 40.36 37.70 38.98 38.34 54.70 40.80 44.66 41.43 40.86 33.58 37.90 32.04 47.19 36.26 33.62

Ulta Beauty Inc's activity ratios, namely Days of Inventory on Hand (DOH), Days of Sales Outstanding (DSO), and Number of Days of Payables, provide insight into the efficiency of the company's operations.

1. Days of Inventory on Hand (DOH):
- The DOH has shown fluctuations over the periods provided, ranging from 90.73 days to 140.23 days.
- A high DOH indicates that Ulta Beauty Inc may be holding excess inventory, tying up capital and potentially facing risks associated with obsolescence.
- The decreasing trend from the highest levels suggests a more efficient management of inventory levels in recent periods.
- Overall, a moderate level of DOH is preferable for balanced inventory management, ensuring availability of goods while minimizing carrying costs.

2. Days of Sales Outstanding (DSO):
- The DSO ranges from 4.74 days to 11.46 days, with lower values indicating faster collection of receivables.
- Ulta Beauty Inc has maintained relatively consistent DSO levels over the periods, suggesting effective credit management and timely collection from customers.
- A lower DSO reflects strong cash flow generation and efficient credit policies, positively impacting the company's liquidity position.
- However, a very low DSO could also indicate overly stringent credit policies, potentially hampering sales growth.

3. Number of Days of Payables:
- The days of payables range from 29.09 days to 54.70 days, with higher values indicating extended payment periods to suppliers.
- Ulta Beauty Inc has demonstrated fluctuations in payables days, possibly influenced by negotiation terms with suppliers and working capital management strategies.
- Extending payables period can provide advantages such as preserving cash flow and improving liquidity in the short term.
- However, excessively long payables days may strain relationships with suppliers or signal cash flow difficulties.

In conclusion, monitoring and optimizing these activity ratios are crucial for Ulta Beauty Inc to ensure efficient use of resources, maintain healthy cash flows, and enhance overall operational performance.


See also:

Ulta Beauty Inc Short-term (Operating) Activity Ratios (Quarterly Data)


Long-term

Feb 3, 2024 Oct 28, 2023 Jul 29, 2023 Apr 29, 2023 Jan 28, 2023 Oct 29, 2022 Jul 30, 2022 Apr 30, 2022 Jan 29, 2022 Oct 30, 2021 Jul 31, 2021 May 1, 2021 Jan 30, 2021 Oct 31, 2020 Aug 1, 2020 May 2, 2020 Feb 1, 2020 Nov 2, 2019 Aug 3, 2019 May 4, 2019
Fixed asset turnover 9.48 9.73 10.00 10.29 10.11 10.04 10.27 9.94 9.44 8.91 8.42 7.20 6.18 6.01 5.93 5.95 6.14 5.85 5.82 5.74
Total asset turnover 1.96 1.94 2.04 1.95 1.90 1.82 1.89 1.80 1.81 1.53 1.55 1.36 1.21 1.28 1.16 1.23 1.52 1.46 1.51 1.45

Ulta Beauty Inc's long-term activity ratios indicate the efficiency with which the company utilizes its assets to generate sales.

1. Fixed asset turnover: Ulta Beauty Inc's fixed asset turnover has shown a fluctuating trend over the past few quarters, ranging from a high of 10.29 to a low of 5.74. This ratio measures how effectively the company generates revenue from its fixed assets such as property, plant, and equipment. A higher ratio generally indicates better efficiency in using fixed assets to generate sales.

2. Total asset turnover: Ulta Beauty Inc's total asset turnover has also displayed variability, with values ranging from 1.16 to 2.04. This ratio reflects the company's ability to generate sales from all its assets, including both fixed and current assets. A higher total asset turnover suggests that the company is efficient in generating revenue from its total asset base.

In summary, Ulta Beauty Inc has exhibited fluctuating but generally healthy levels of asset turnover ratios, indicating a reasonable efficiency in utilizing its assets to generate sales over the analyzed periods. It is important for the company to monitor and manage these ratios effectively to ensure sustained operational efficiency and profitability.


See also:

Ulta Beauty Inc Long-term (Investment) Activity Ratios (Quarterly Data)