Citi analyst Kelly Crago raised the firm’s price target on Ulta Beauty to $390 from $345 and keeps a Neutral rating on the shares. The firm anticipates a Q3 earnings beat when Ulta reports on December 5, driven by stronger comps and slightly stronger gross margin. The company is facing headwinds from weakening category trends and increased competition that are making it difficult to drive traffic this year, the analyst tells investors in a research note. However, Citi says that given its view that trends have not gotten any worse in Q3 versus Q2, it anticipates Ulta will narrow its fiscal 2024 earnings guidance range, “taking the worst case scenario off the table.” The firm believes the stock’s risk/reward is balanced into Q3 earnings.