In his first "Executive Decision" segment of Mad Money Wednesday evening, Jim Cramer spoke with Mary Dillon, CEO of Ulta Beauty Inc. (ULTA) , the beauty retailer that's learning to navigate our Covid-19 world.
Dillon said she's glad the company invested in its digital strategy, as it's been paying off during the pandemic. Sales are up at both the website and on the app. Customers are also loving their new skincare analysis tool, which uses augmented reality and artificial intelligence to provide personalized recommendations. Digital is certainly the future of retail and retailers need to start evolving.
As for their in-store experience, Dillon said guests are returning to stores, and while they are coming less frequently, they're buying more and are utilizing new services like curbside pickup.
Let's check and see if this corporate enthusiasm is reflected in the stock price.
In the daily bar chart of ULTA, below, we can see that share prices were more than cut in half from February to March. Prices rebounded into June but then turned sideways. ULTA is trading just above the bottoming 200-day moving average line and above the rising 50-day moving average line.
The trading volume was not particularly heavy at the bottom in March and has not increased since the nadir. There is a volume surge at the end of August and that has lifted the On-Balance-Volume (OBV) line to a new high. A rising OBV line tells us that buyers of a stock are being more aggressive and that helps to confirm price advances.
The trend-following Moving Average Convergence Divergence (MACD) oscillator has been moving around the zero line since May but is currently above the line in positive/constructive territory.