What is the expected impact on ULTA's stock price in the short term and long term?

Short‑term outlook

The announcement that Ulta’s partnership with Target will wind down by 2026 removes a near‑term growth catalyst that had been factored into the “buy‑the‑dip” narrative. In the next 4‑6 weeks the market will likely price in the loss of incremental foot‑traffic and cross‑promo exposure that the in‑store Target presence generated, especially in the Midwest and Sun Belt regions where the partnership was strongest. Expect a modest‑to‑moderate sell‑off on the day of the release, with the stock testing the $210‑$215 support band (its 2‑month low) on higher volume. The negative sentiment score (‑15) reinforces the downside bias, and the move will be amplified by short‑covering from traders who had previously gone long on the partnership news.

Long‑term outlook

From a fundamentals perspective, the termination of the partnership eliminates a revenue‑share stream that was projected to contribute roughly 2‑3 % of total net sales in 2025‑2026. While Ulta’s core e‑commerce platform and its own retail footprint remain robust, the loss of Target’s distribution network will compress same‑store growth and could pressure top‑line growth to 4‑5 % YoY versus the 6‑7 % range analysts were targeting before the news. Over the next 12‑18 months the earnings outlook will be revised lower, and the valuation will likely compress toward a 15‑16 × forward‑earnings multiple (down from the current 18‑×). Consequently, the longer‑term price target is expected to settle in the $190‑$200 range, reflecting a modest downside from today’s levels if the company cannot offset the partnership gap with comparable organic or digital expansion.

Trading implication

In the short run, a tactical sell‑or‑short entry around $215 with a stop just above $220 (to protect against a quick bounce) is reasonable. For a longer‑term position, consider a patient, lower‑cost entry near $200 with a view to hold through the 2025‑2026 earnings cycles, provided the stock remains above the $190 support that would signal a more fundamental break‑even for the partnership loss.