Stock Analysis on Net
Stock Analysis on Net

Ulta Beauty Inc. (NASDAQ:ULTA)

This company has been moved to the archive! The financial data has not been updated since August 24, 2023.

Capital Asset Pricing Model (CAPM) 

Microsoft Excel

Capital asset pricing model (CAPM) indicates what should be the expected or required rate of return on risky assets like Ulta Beauty Inc. common stock.

Rates of Return

Ulta Beauty Inc., monthly rates of return

Microsoft Excel
Ulta Beauty Inc. (ULTA) Standard & Poor’s 500 (S&P 500)
t Date PriceULTA,t1 DividendULTA,t1 RULTA,t2 PriceS&P 500,t RS&P 500,t3
Feb 28, 2017 $273.43 2,363.64
1. Mar 31, 2017 $285.23 4.32% 2,362.72 -0.04%
2. Apr 30, 2017 $281.44 -1.33% 2,384.20 0.91%
3. May 31, 2017 $304.84 8.31% 2,411.80 1.16%
. . . . . . .
. . . . . . .
. . . . . . .
70. Dec 31, 2022 $469.07 0.91% 3,839.50 -5.90%
71. Jan 31, 2023 $513.96 9.57% 4,076.60 6.18%
Average (R): 1.50% 0.90%
Standard deviation: 10.95% 5.01%
Ulta Beauty Inc. (ULTA) Standard & Poor’s 500 (S&P 500)
t Date PriceULTA,t1 DividendULTA,t1 RULTA,t2 PriceS&P 500,t RS&P 500,t3
Feb 28, 2017 $273.43 2,363.64
1. Mar 31, 2017 $285.23 4.32% 2,362.72 -0.04%
2. Apr 30, 2017 $281.44 -1.33% 2,384.20 0.91%
3. May 31, 2017 $304.84 8.31% 2,411.80 1.16%
4. Jun 30, 2017 $287.34 -5.74% 2,423.41 0.48%
5. Jul 31, 2017 $251.21 -12.57% 2,470.30 1.93%
6. Aug 31, 2017 $221.01 -12.02% 2,471.65 0.05%
7. Sep 30, 2017 $226.06 2.28% 2,519.36 1.93%
8. Oct 31, 2017 $201.79 -10.74% 2,575.26 2.22%
9. Nov 30, 2017 $221.71 9.87% 2,647.58 2.81%
10. Dec 31, 2017 $223.66 0.88% 2,673.61 0.98%
11. Jan 31, 2018 $222.10 -0.70% 2,823.81 5.62%
12. Feb 28, 2018 $203.35 -8.44% 2,713.83 -3.89%
13. Mar 31, 2018 $204.27 0.45% 2,640.87 -2.69%
14. Apr 30, 2018 $250.91 22.83% 2,648.05 0.27%
15. May 31, 2018 $246.91 -1.59% 2,705.27 2.16%
16. Jun 30, 2018 $233.46 -5.45% 2,718.37 0.48%
17. Jul 31, 2018 $244.39 4.68% 2,816.29 3.60%
18. Aug 31, 2018 $260.00 6.39% 2,901.52 3.03%
19. Sep 30, 2018 $282.12 8.51% 2,913.98 0.43%
20. Oct 31, 2018 $274.52 -2.69% 2,711.74 -6.94%
21. Nov 30, 2018 $297.79 8.48% 2,760.17 1.79%
22. Dec 31, 2018 $244.84 -17.78% 2,506.85 -9.18%
23. Jan 31, 2019 $291.92 19.23% 2,704.10 7.87%
24. Feb 28, 2019 $312.49 7.05% 2,784.49 2.97%
25. Mar 31, 2019 $348.73 11.60% 2,834.40 1.79%
26. Apr 30, 2019 $348.98 0.07% 2,945.83 3.93%
27. May 31, 2019 $333.38 -4.47% 2,752.06 -6.58%
28. Jun 30, 2019 $346.89 4.05% 2,941.76 6.89%
29. Jul 31, 2019 $349.25 0.68% 2,980.38 1.31%
30. Aug 31, 2019 $237.73 -31.93% 2,926.46 -1.81%
31. Sep 30, 2019 $250.65 5.43% 2,976.74 1.72%
32. Oct 31, 2019 $233.15 -6.98% 3,037.56 2.04%
33. Nov 30, 2019 $233.86 0.30% 3,140.98 3.40%
34. Dec 31, 2019 $253.14 8.24% 3,230.78 2.86%
35. Jan 31, 2020 $267.91 5.83% 3,225.52 -0.16%
36. Feb 29, 2020 $257.09 -4.04% 2,954.22 -8.41%
37. Mar 31, 2020 $175.70 -31.66% 2,584.59 -12.51%
38. Apr 30, 2020 $217.92 24.03% 2,912.43 12.68%
39. May 31, 2020 $244.01 11.97% 3,044.31 4.53%
40. Jun 30, 2020 $203.42 -16.63% 3,100.29 1.84%
41. Jul 31, 2020 $192.99 -5.13% 3,271.12 5.51%
42. Aug 31, 2020 $232.18 20.31% 3,500.31 7.01%
43. Sep 30, 2020 $223.98 -3.53% 3,363.00 -3.92%
44. Oct 31, 2020 $206.77 -7.68% 3,269.96 -2.77%
45. Nov 30, 2020 $275.40 33.19% 3,621.63 10.75%
46. Dec 31, 2020 $287.16 4.27% 3,756.07 3.71%
47. Jan 31, 2021 $279.76 -2.58% 3,714.24 -1.11%
48. Feb 28, 2021 $322.33 15.22% 3,811.15 2.61%
49. Mar 31, 2021 $309.17 -4.08% 3,972.89 4.24%
50. Apr 30, 2021 $329.35 6.53% 4,181.17 5.24%
51. May 31, 2021 $345.36 4.86% 4,204.11 0.55%
52. Jun 30, 2021 $345.77 0.12% 4,297.50 2.22%
53. Jul 31, 2021 $335.80 -2.88% 4,395.26 2.27%
54. Aug 31, 2021 $387.31 15.34% 4,522.68 2.90%
55. Sep 30, 2021 $360.92 -6.81% 4,307.54 -4.76%
56. Oct 31, 2021 $367.36 1.78% 4,605.38 6.91%
57. Nov 30, 2021 $383.95 4.52% 4,567.00 -0.83%
58. Dec 31, 2021 $412.34 7.39% 4,766.18 4.36%
59. Jan 31, 2022 $363.74 -11.79% 4,515.55 -5.26%
60. Feb 28, 2022 $374.50 2.96% 4,373.94 -3.14%
61. Mar 31, 2022 $398.22 6.33% 4,530.41 3.58%
62. Apr 30, 2022 $396.80 -0.36% 4,131.93 -8.80%
63. May 31, 2022 $423.10 6.63% 4,132.15 0.01%
64. Jun 30, 2022 $385.48 -8.89% 3,785.38 -8.39%
65. Jul 31, 2022 $388.91 0.89% 4,130.29 9.11%
66. Aug 31, 2022 $419.87 7.96% 3,955.00 -4.24%
67. Sep 30, 2022 $401.19 -4.45% 3,585.62 -9.34%
68. Oct 31, 2022 $419.37 4.53% 3,871.98 7.99%
69. Nov 30, 2022 $464.84 10.84% 4,080.11 5.38%
70. Dec 31, 2022 $469.07 0.91% 3,839.50 -5.90%
71. Jan 31, 2023 $513.96 9.57% 4,076.60 6.18%
Average (R): 1.50% 0.90%
Standard deviation: 10.95% 5.01%

Show all

1 Data in US$ per share of common stock, adjusted for splits and stock dividends.

2 Rate of return on common stock of ULTA during period t

3 Rate of return on S&P 500 (the market portfolio proxy) during period t

Variance and Covariance

Ulta Beauty Inc., calculation of variance and covariance of returns

Microsoft Excel
t Date RULTA,t RS&P 500,t (RULTA,t–RULTA)2 (RS&P 500,t–RS&P 500)2 (RULTA,t–RULTA)×(RS&P 500,t–RS&P 500)
1. Mar 31, 2017 4.32% -0.04% 7.91 0.87 -2.63
2. Apr 30, 2017 -1.33% 0.91% 8.02 0.00 -0.04
3. May 31, 2017 8.31% 1.16% 46.40 0.07 1.79
. . . . . . .
. . . . . . .
. . . . . . .
70. Dec 31, 2022 0.91% -5.90% 0.35 46.14 4.03
71. Jan 31, 2023 9.57% 6.18% 65.08 27.88 42.60
Total (Σ): 8,390.96 1,754.14 2,258.16
t Date RULTA,t RS&P 500,t (RULTA,t–RULTA)2 (RS&P 500,t–RS&P 500)2 (RULTA,t–RULTA)×(RS&P 500,t–RS&P 500)
1. Mar 31, 2017 4.32% -0.04% 7.91 0.87 -2.63
2. Apr 30, 2017 -1.33% 0.91% 8.02 0.00 -0.04
3. May 31, 2017 8.31% 1.16% 46.40 0.07 1.79
4. Jun 30, 2017 -5.74% 0.48% 52.47 0.17 3.00
5. Jul 31, 2017 -12.57% 1.93% 198.15 1.08 -14.63
6. Aug 31, 2017 -12.02% 0.05% 182.91 0.71 11.37
7. Sep 30, 2017 2.28% 1.93% 0.61 1.07 0.81
8. Oct 31, 2017 -10.74% 2.22% 149.79 1.75 -16.20
9. Nov 30, 2017 9.87% 2.81% 70.04 3.66 16.01
10. Dec 31, 2017 0.88% 0.98% 0.39 0.01 -0.05
11. Jan 31, 2018 -0.70% 5.62% 4.84 22.30 -10.39
12. Feb 28, 2018 -8.44% -3.89% 98.90 22.94 47.64
13. Mar 31, 2018 0.45% -2.69% 1.10 12.84 3.76
14. Apr 30, 2018 22.83% 0.27% 454.96 0.39 -13.30
15. May 31, 2018 -1.59% 2.16% 9.59 1.60 -3.92
16. Jun 30, 2018 -5.45% 0.48% 48.30 0.17 2.86
17. Jul 31, 2018 4.68% 3.60% 10.11 7.33 8.61
18. Aug 31, 2018 6.39% 3.03% 23.86 4.54 10.41
19. Sep 30, 2018 8.51% 0.43% 49.07 0.22 -3.26
20. Oct 31, 2018 -2.69% -6.94% 17.61 61.40 32.88
21. Nov 30, 2018 8.48% 1.79% 48.63 0.79 6.21
22. Dec 31, 2018 -17.78% -9.18% 371.86 101.46 194.24
23. Jan 31, 2019 19.23% 7.87% 314.22 48.63 123.61
24. Feb 28, 2019 7.05% 2.97% 30.73 4.32 11.52
25. Mar 31, 2019 11.60% 1.79% 101.90 0.80 9.06
26. Apr 30, 2019 0.07% 3.93% 2.05 9.22 -4.34
27. May 31, 2019 -4.47% -6.58% 35.68 55.85 44.64
28. Jun 30, 2019 4.05% 6.89% 6.50 35.97 15.29
29. Jul 31, 2019 0.68% 1.31% 0.68 0.17 -0.34
30. Aug 31, 2019 -31.93% -1.81% 1,117.84 7.31 90.42
31. Sep 30, 2019 5.43% 1.72% 15.46 0.68 3.24
32. Oct 31, 2019 -6.98% 2.04% 71.99 1.32 -9.74
33. Nov 30, 2019 0.30% 3.40% 1.44 6.30 -3.01
34. Dec 31, 2019 8.24% 2.86% 45.45 3.86 13.24
35. Jan 31, 2020 5.83% -0.16% 18.77 1.12 -4.58
36. Feb 29, 2020 -4.04% -8.41% 30.71 86.61 51.57
37. Mar 31, 2020 -31.66% -12.51% 1,099.65 179.75 444.60
38. Apr 30, 2020 24.03% 12.68% 507.46 138.98 265.57
39. May 31, 2020 11.97% 4.53% 109.61 13.20 38.03
40. Jun 30, 2020 -16.63% 1.84% 328.96 0.89 -17.11
41. Jul 31, 2020 -5.13% 5.51% 43.96 21.30 -30.60
42. Aug 31, 2020 20.31% 7.01% 353.59 37.35 114.91
43. Sep 30, 2020 -3.53% -3.92% 25.35 23.21 24.26
44. Oct 31, 2020 -7.68% -2.77% 84.39 13.41 33.64
45. Nov 30, 2020 33.19% 10.75% 1,004.17 97.21 312.43
46. Dec 31, 2020 4.27% 3.71% 7.66 7.93 7.80
47. Jan 31, 2021 -2.58% -1.11% 16.64 4.04 8.20
48. Feb 28, 2021 15.22% 2.61% 188.07 2.94 23.50
49. Mar 31, 2021 -4.08% 4.24% 31.20 11.21 -18.70
50. Apr 30, 2021 6.53% 5.24% 25.24 18.90 21.84
51. May 31, 2021 4.86% 0.55% 11.28 0.12 -1.16
52. Jun 30, 2021 0.12% 2.22% 1.92 1.76 -1.84
53. Jul 31, 2021 -2.88% 2.27% 19.24 1.90 -6.05
54. Aug 31, 2021 15.34% 2.90% 191.45 4.02 27.73
55. Sep 30, 2021 -6.81% -4.76% 69.16 31.95 47.01
56. Oct 31, 2021 1.78% 6.91% 0.08 36.23 1.69
57. Nov 30, 2021 4.52% -0.83% 9.08 2.99 -5.21
58. Dec 31, 2021 7.39% 4.36% 34.71 12.01 20.42
59. Jan 31, 2022 -11.79% -5.26% 176.60 37.87 81.78
60. Feb 28, 2022 2.96% -3.14% 2.12 16.25 -5.87
61. Mar 31, 2022 6.33% 3.58% 23.34 7.19 12.96
62. Apr 30, 2022 -0.36% -8.80% 3.46 93.91 18.02
63. May 31, 2022 6.63% 0.01% 26.27 0.79 -4.56
64. Jun 30, 2022 -8.89% -8.39% 108.04 86.25 96.53
65. Jul 31, 2022 0.89% 9.11% 0.38 67.51 -5.04
66. Aug 31, 2022 7.96% -4.24% 41.70 26.41 -33.19
67. Sep 30, 2022 -4.45% -9.34% 35.42 104.75 60.92
68. Oct 31, 2022 4.53% 7.99% 9.17 50.28 21.48
69. Nov 30, 2022 10.84% 5.38% 87.23 20.07 41.84
70. Dec 31, 2022 0.91% -5.90% 0.35 46.14 4.03
71. Jan 31, 2023 9.57% 6.18% 65.08 27.88 42.60
Total (Σ): 8,390.96 1,754.14 2,258.16

Show all

VarianceULTA = Σ(RULTA,t–RULTA)2 ÷ (71 – 1)
= 8,390.96 ÷ (71 – 1)
= 119.87

VarianceS&P 500 = Σ(RS&P 500,t–RS&P 500)2 ÷ (71 – 1)
= 1,754.14 ÷ (71 – 1)
= 25.06

CovarianceULTA, S&P 500 = Σ(RULTA,t–RULTA)×(RS&P 500,t–RS&P 500) ÷ (71 – 1)
= 2,258.16 ÷ (71 – 1)
= 32.26

Systematic Risk (β) Estimation

Microsoft Excel
VarianceULTA 119.87
VarianceS&P 500 25.06
CovarianceULTA, S&P 500 32.26
Correlation coefficientULTA, S&P 5001 0.59
βULTA2 1.29
αULTA3 0.35%

Calculations

1 Correlation coefficientULTA, S&P 500
= CovarianceULTA, S&P 500 ÷ (Standard deviationULTA × Standard deviationS&P 500)
= 32.26 ÷ (10.95% × 5.01%)
= 0.59

2 βULTA
= CovarianceULTA, S&P 500 ÷ VarianceS&P 500
= 32.26 ÷ 25.06
= 1.29

3 αULTA
= AverageULTA – βULTA × AverageS&P 500
= 1.50% – 1.29 × 0.90%
= 0.35%

Expected Rate of Return

Microsoft Excel
Assumptions
Rate of return on LT Treasury Composite1 RF 4.67%
Expected rate of return on market portfolio2 E(RM) 13.79%
Systematic risk (β) of Ulta Beauty Inc. common stock βULTA 1.29
 
Expected rate of return on Ulta Beauty Inc. common stock3 E(RULTA) 16.41%

1 Unweighted average of bid yields on all outstanding fixed-coupon U.S. Treasury bonds neither due or callable in less than 10 years (risk-free rate of return proxy).

2 See details »

3 E(RULTA) = RF + βULTA [E(RM) – RF]
= 4.67% + 1.29 [13.79% – 4.67%]
= 16.41%