12:00 PM EDT, 10/02/2024 (MT Newswires) -- Ulta Beauty ( ULTA ) could set "achievable" targets during its analyst day on Oct. 16, which will likely serve as a positive catalyst for the company, UBS said in a note to clients on Wednesday.

The beauty retailer can set a "compelling set of building blocks" that support a positive mid- to high-single-digit percentage in earnings per share growth algorithm for the next few years, UBS said.

"While this would be below its previous formula of low double-digit EPS growth, we think [the company] setting an achievable set of targets should go a long way for the market to gain confidence in Ulta's forward estimates following the event," UBS said. Also, there's potential for Ulta to start a dividend, which would unlock appetite for its shares from more potential investors, the investment firm added.

"We think these factors will help propel shares higher," UBS said.

UBS has a buy rating on Ulta and a $505 price target.

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