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Why ULTA & 3 Retail-Miscellaneous Stocks Could Be the Next Big Winners
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The Retail–Miscellaneous industry continues to showcase resilience in a challenging consumer landscape owing to diversified product portfolios and adaptive business models. Companies spanning across categories such as home furnishings, beauty, pet care, sporting goods and specialty retail are benefiting from a blend of value-driven and lifestyle-oriented demand. Consumers are increasingly prioritizing quality and convenience, prompting retailers to strengthen omnichannel platforms, expand private-label offerings and enhance digital engagement. Meanwhile, prudent cost control, inventory discipline and targeted promotional activity are helping players mitigate margin pressures in a still-uneven spending environment.
Industry participants are leveraging data analytics and loyalty programs to improve personalization and customer retention. As discretionary trends stabilize and household spending shifts toward premium and need-based categories, retailers with balanced assortments and operational agility stand to gain. Against this backdrop, Ulta Beauty, Inc. (ULTA - Free Report) , Sally Beauty Holdings, Inc. (SBH - Free Report) , Arhaus, Inc. (ARHS - Free Report) and Petco Health and Wellness Company, Inc. (WOOF - Free Report) emerge as key players in the Retail–Miscellaneous space.
About the Industry
The Zacks Retail–Miscellaneous industry encompasses a diverse array of retailers, including those specializing in sporting goods, office supplies, specialty products and domestic merchandise. It also features beauty product retailers offering cosmetics, fragrances, skincare, haircare and salon styling tools. The industry also includes rural lifestyle stores, art and craft specialty outlets and suppliers catering to farmers, ranchers, tradesmen and small businesses. Recreational boat and yacht retailers, along with specialty value retailers targeting tween and teen customers, are also key players. Profitability within this sector hinges on a balanced pricing strategy, efficient supply chain management, effective merchandising tactics and continuous innovation to meet consumer demands and maintain competitive positioning in a dynamic market.
4 Key Industry Trends
Consumers’ Willingness to Spend: The Retail–Miscellaneous industry is closely tied to consumers’ purchasing power. U.S. retail sales rose 0.6% in August, according to the U.S. Department of Commerce, indicating resilient consumer spending. Supporting this trend, the Federal Reserve’s recent interest rate cuts have lowered borrowing costs, giving consumers more flexibility to spend on discretionary items and fueling demand across the sector. Moreover, with the holiday season approaching, retailers can expect a further boost in demand as shoppers increase spending on gifts, fashion and seasonal apparel, creating an opportunity for stronger sales and revenue growth heading into year-end. According to Deloitte, U.S. holiday retail sales are projected to rise between 2.9% and 3.4% during the November-to-January period.
Focus on Boosting Portfolio & Market Reach: Most companies in the industry are emphasizing product diversification, digital engagement and pricing efficiency to drive growth. Efforts center on expanding product assortments, strengthening online and omnichannel capabilities and introducing loyalty or reward programs to deepen customer connections. Many players are also innovating across categories to meet growing demand for personal care items, domestic merchandise and fitness-related products. To capitalize on these opportunities, companies are adopting targeted marketing strategies and data-driven initiatives to enhance brand visibility, boost sales and extend their market reach.
Digitization, Key to Growth: With evolving consumer shopping patterns, industry players are striking a balance between in-store and online channels. Companies are channeling more resources into digital platforms, accelerating store fleet optimization and modernizing supply chains. Expanding delivery options — including curbside pickup, ship-to-home and contactless payment solutions — continues to improve convenience and engagement. Retailers are also investing in store remodels, upgraded checkout systems and mobile point-of-sale tools to keep brick-and-mortar formats relevant. By aligning with shifting preferences and strengthening digital capabilities, companies are replenishing assortments efficiently and deepening investments in technology to fuel long-term growth.
Pressure on Margins to Linger: Companies within the industry continue to face competitive pressures stemming from pricing, product breadth and speed to market. To maintain relevance and meet consumer expectations, many are ramping up investments in digital ecosystems, logistics and delivery capabilities. While these initiatives support top-line growth, they also elevate expenses. Margin pressures persist due to higher labor, occupancy and marketing costs, as well as potential SG&A deleverage. In response, retailers are pursuing cost-mitigation strategies — streamlining operations, optimizing supply networks, and implementing disciplined pricing and inventory management — to protect profitability.
Zacks Industry Rank Indicates Bright Prospects
The Zacks Retail – Miscellaneous industry is housed within the broader Zacks Retail – Wholesale sector. The industry currently carries a Zacks Industry Rank #29, which places it in the top 12% of more than 250 Zacks industries.
The group’s Zacks Industry Rank, which is basically the average of the Zacks Rank of all the member stocks, indicates encouraging near-term prospects. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. The industry’s position in the top 50% of the Zacks-ranked industries is a result of a positive earnings outlook for the constituent companies in aggregate.
Looking at the aggregate earnings estimate revisions, it appears that analysts are gaining confidence in this group’s earnings growth potential. Since the beginning of May 2025, the industry’s earnings estimate has risen roughly 2%.
Before we present a few stocks that you may want to consider for your portfolio, let’s take a look at the industry’s recent stock-market performance and valuation picture.
Industry vs. Broader Market
The Zacks Retail – Miscellaneous industry has underperformed the broader Retail – Wholesale sector and the Zacks S&P 500 composite over the past year.
The industry has advanced 6.7% over this period. Meanwhile, the S&P 500 has risen 18.3%, and the broader sector has jumped 11.3% in the said time frame.
One-Year Price Performance
Industry's Current Valuation
On the basis of forward 12-month price-to-earnings (P/E), which is commonly used for valuing retail stocks, the industry is currently trading at 18.13X compared with the S&P 500’s 23.65X and the sector’s 24.58X.
Over the last five years, the industry has traded as high as 20.90X, as low as 12.50X and at the median of 17.19X, as the chart below shows.
Price-to-Earnings Ratio (Past Five Years)
4 Stocks to Watch
Arhaus: Arhaus continues to demonstrate brand strength and operational excellence through its artisan-crafted, globally inspired designs and a disciplined growth strategy. Its expansion into new lifestyle categories like the Bath Collection underscores its ability to evolve. Strategic initiatives, such as in-sourcing logistics and omnichannel, enhance efficiency and deepen client engagement. With a debt-free balance sheet and a premium positioning in the home furnishings market, Arhaus appears well-poised for sustainable long-term growth and value creation.
Arhaus has a trailing four-quarter earnings surprise of 5.2%, on average. The Zacks Consensus Estimate for Arhaus’ current financial-year revenues suggests growth of 6.9% from the year-ago reported figure. Shares of this Zacks Rank #1 (Strong Buy) company have declined 3.1% in the past year. You can see the complete list of today’s Zacks #1 Rank stocks here.
Price and Consensus: ARHS
Petco Health and Wellness Company: Petco’s transformation strategy is gaining momentum, underpinned by disciplined execution, stronger retail fundamentals and a revitalized brand identity. The company is reconnecting with pet parents through its refreshed “Where the Pets Go” campaign, enhanced in-store experiences and merchandising innovation that reinforces its differentiated market position. Operational improvements across the supply chain, store execution, and cost management are strengthening profitability and efficiency. With a reinvigorated culture, expanding customer engagement and a clear roadmap toward profitable growth, Petco is well-positioned to capture long-term opportunities in the evolving pet care and wellness market.
Petco has a trailing four-quarter earnings surprise of 170.8%, on average. The Zacks Consensus Estimate for the current financial-year EPS implies growth of 250% from the year-ago reported figure. Shares of this Zacks Rank #1 company have declined 27.1% in the past year.
Price and Consensus: WOOF
Sally Beauty: Sally Beauty’s transformation into a modern specialty beauty retailer is gaining traction, supported by strong innovation, a growing digital marketplace and a refreshed in-store experience. Initiatives like Licensed Colorist OnDemand, the “Fuel for Growth” cost-efficiency program, and category expansion in nails and cosmetics are strengthening customer engagement and profitability. The company’s steady cash generation and measured store refresh rollout highlight disciplined execution. With a resilient portfolio of owned and exclusive brands, Sally Beauty is well-positioned to sustain margin gains and deliver consistent shareholder value over time.
Sally Beauty has a trailing four-quarter earnings surprise of 8.3%, on average. The Zacks Consensus Estimate for the current financial-year EPS suggests growth of 8.9% from the year-ago reported figure. Shares of this Zacks Rank #2 (Buy) company have gained 17.9% in the past year.
Price and Consensus: SBH
Ulta Beauty: Ulta Beauty’s strong momentum reflects the successful execution of its Ulta Beauty Unleashed strategy, driving share gains across all categories and channels while deepening customer loyalty. The company continues to differentiate itself through innovative merchandising, exclusive brand launches, experiential marketing, and expansion into international beauty and wellness markets. Strategic investments in digital personalization, supply-chain optimization and Ulta Beauty Marketplace reinforce its leadership as an omnichannel powerhouse. With a strong brand portfolio, loyal customers and a clear growth strategy, Ulta Beauty is well-positioned to maintain market leadership and long-term value.
Ulta Beauty has a trailing four-quarter earnings surprise of 16.3%, on average. The Zacks Consensus Estimate for current financial-year revenues calls for growth of 6.8% from the year-ago reported figure. Shares of this Zacks Rank #3 (Hold) company have rallied 51.4% in the past year.
Price and Consensus: ULTA
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Why ULTA & 3 Retail-Miscellaneous Stocks Could Be the Next Big Winners
The Retail–Miscellaneous industry continues to showcase resilience in a challenging consumer landscape owing to diversified product portfolios and adaptive business models. Companies spanning across categories such as home furnishings, beauty, pet care, sporting goods and specialty retail are benefiting from a blend of value-driven and lifestyle-oriented demand. Consumers are increasingly prioritizing quality and convenience, prompting retailers to strengthen omnichannel platforms, expand private-label offerings and enhance digital engagement. Meanwhile, prudent cost control, inventory discipline and targeted promotional activity are helping players mitigate margin pressures in a still-uneven spending environment.
Industry participants are leveraging data analytics and loyalty programs to improve personalization and customer retention. As discretionary trends stabilize and household spending shifts toward premium and need-based categories, retailers with balanced assortments and operational agility stand to gain. Against this backdrop, Ulta Beauty, Inc. (ULTA - Free Report) , Sally Beauty Holdings, Inc. (SBH - Free Report) , Arhaus, Inc. (ARHS - Free Report) and Petco Health and Wellness Company, Inc. (WOOF - Free Report) emerge as key players in the Retail–Miscellaneous space.
About the Industry
The Zacks Retail–Miscellaneous industry encompasses a diverse array of retailers, including those specializing in sporting goods, office supplies, specialty products and domestic merchandise. It also features beauty product retailers offering cosmetics, fragrances, skincare, haircare and salon styling tools. The industry also includes rural lifestyle stores, art and craft specialty outlets and suppliers catering to farmers, ranchers, tradesmen and small businesses. Recreational boat and yacht retailers, along with specialty value retailers targeting tween and teen customers, are also key players. Profitability within this sector hinges on a balanced pricing strategy, efficient supply chain management, effective merchandising tactics and continuous innovation to meet consumer demands and maintain competitive positioning in a dynamic market.
4 Key Industry Trends
Consumers’ Willingness to Spend: The Retail–Miscellaneous industry is closely tied to consumers’ purchasing power. U.S. retail sales rose 0.6% in August, according to the U.S. Department of Commerce, indicating resilient consumer spending. Supporting this trend, the Federal Reserve’s recent interest rate cuts have lowered borrowing costs, giving consumers more flexibility to spend on discretionary items and fueling demand across the sector. Moreover, with the holiday season approaching, retailers can expect a further boost in demand as shoppers increase spending on gifts, fashion and seasonal apparel, creating an opportunity for stronger sales and revenue growth heading into year-end. According to Deloitte, U.S. holiday retail sales are projected to rise between 2.9% and 3.4% during the November-to-January period.
Focus on Boosting Portfolio & Market Reach: Most companies in the industry are emphasizing product diversification, digital engagement and pricing efficiency to drive growth. Efforts center on expanding product assortments, strengthening online and omnichannel capabilities and introducing loyalty or reward programs to deepen customer connections. Many players are also innovating across categories to meet growing demand for personal care items, domestic merchandise and fitness-related products. To capitalize on these opportunities, companies are adopting targeted marketing strategies and data-driven initiatives to enhance brand visibility, boost sales and extend their market reach.
Digitization, Key to Growth: With evolving consumer shopping patterns, industry players are striking a balance between in-store and online channels. Companies are channeling more resources into digital platforms, accelerating store fleet optimization and modernizing supply chains. Expanding delivery options — including curbside pickup, ship-to-home and contactless payment solutions — continues to improve convenience and engagement. Retailers are also investing in store remodels, upgraded checkout systems and mobile point-of-sale tools to keep brick-and-mortar formats relevant. By aligning with shifting preferences and strengthening digital capabilities, companies are replenishing assortments efficiently and deepening investments in technology to fuel long-term growth.
Pressure on Margins to Linger: Companies within the industry continue to face competitive pressures stemming from pricing, product breadth and speed to market. To maintain relevance and meet consumer expectations, many are ramping up investments in digital ecosystems, logistics and delivery capabilities. While these initiatives support top-line growth, they also elevate expenses. Margin pressures persist due to higher labor, occupancy and marketing costs, as well as potential SG&A deleverage. In response, retailers are pursuing cost-mitigation strategies — streamlining operations, optimizing supply networks, and implementing disciplined pricing and inventory management — to protect profitability.
Zacks Industry Rank Indicates Bright Prospects
The Zacks Retail – Miscellaneous industry is housed within the broader Zacks Retail – Wholesale sector. The industry currently carries a Zacks Industry Rank #29, which places it in the top 12% of more than 250 Zacks industries.
The group’s Zacks Industry Rank, which is basically the average of the Zacks Rank of all the member stocks, indicates encouraging near-term prospects. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. The industry’s position in the top 50% of the Zacks-ranked industries is a result of a positive earnings outlook for the constituent companies in aggregate.
Looking at the aggregate earnings estimate revisions, it appears that analysts are gaining confidence in this group’s earnings growth potential. Since the beginning of May 2025, the industry’s earnings estimate has risen roughly 2%.
Before we present a few stocks that you may want to consider for your portfolio, let’s take a look at the industry’s recent stock-market performance and valuation picture.
Industry vs. Broader Market
The Zacks Retail – Miscellaneous industry has underperformed the broader Retail – Wholesale sector and the Zacks S&P 500 composite over the past year.
The industry has advanced 6.7% over this period. Meanwhile, the S&P 500 has risen 18.3%, and the broader sector has jumped 11.3% in the said time frame.
One-Year Price Performance
Industry's Current Valuation
On the basis of forward 12-month price-to-earnings (P/E), which is commonly used for valuing retail stocks, the industry is currently trading at 18.13X compared with the S&P 500’s 23.65X and the sector’s 24.58X.
Over the last five years, the industry has traded as high as 20.90X, as low as 12.50X and at the median of 17.19X, as the chart below shows.
Price-to-Earnings Ratio (Past Five Years)
4 Stocks to Watch
Arhaus: Arhaus continues to demonstrate brand strength and operational excellence through its artisan-crafted, globally inspired designs and a disciplined growth strategy. Its expansion into new lifestyle categories like the Bath Collection underscores its ability to evolve. Strategic initiatives, such as in-sourcing logistics and omnichannel, enhance efficiency and deepen client engagement. With a debt-free balance sheet and a premium positioning in the home furnishings market, Arhaus appears well-poised for sustainable long-term growth and value creation.
Arhaus has a trailing four-quarter earnings surprise of 5.2%, on average. The Zacks Consensus Estimate for Arhaus’ current financial-year revenues suggests growth of 6.9% from the year-ago reported figure. Shares of this Zacks Rank #1 (Strong Buy) company have declined 3.1% in the past year. You can see the complete list of today’s Zacks #1 Rank stocks here.
Price and Consensus: ARHS
Petco Health and Wellness Company: Petco’s transformation strategy is gaining momentum, underpinned by disciplined execution, stronger retail fundamentals and a revitalized brand identity. The company is reconnecting with pet parents through its refreshed “Where the Pets Go” campaign, enhanced in-store experiences and merchandising innovation that reinforces its differentiated market position. Operational improvements across the supply chain, store execution, and cost management are strengthening profitability and efficiency. With a reinvigorated culture, expanding customer engagement and a clear roadmap toward profitable growth, Petco is well-positioned to capture long-term opportunities in the evolving pet care and wellness market.
Petco has a trailing four-quarter earnings surprise of 170.8%, on average. The Zacks Consensus Estimate for the current financial-year EPS implies growth of 250% from the year-ago reported figure. Shares of this Zacks Rank #1 company have declined 27.1% in the past year.
Price and Consensus: WOOF
Sally Beauty: Sally Beauty’s transformation into a modern specialty beauty retailer is gaining traction, supported by strong innovation, a growing digital marketplace and a refreshed in-store experience. Initiatives like Licensed Colorist OnDemand, the “Fuel for Growth” cost-efficiency program, and category expansion in nails and cosmetics are strengthening customer engagement and profitability. The company’s steady cash generation and measured store refresh rollout highlight disciplined execution. With a resilient portfolio of owned and exclusive brands, Sally Beauty is well-positioned to sustain margin gains and deliver consistent shareholder value over time.
Sally Beauty has a trailing four-quarter earnings surprise of 8.3%, on average. The Zacks Consensus Estimate for the current financial-year EPS suggests growth of 8.9% from the year-ago reported figure. Shares of this Zacks Rank #2 (Buy) company have gained 17.9% in the past year.
Price and Consensus: SBH
Ulta Beauty: Ulta Beauty’s strong momentum reflects the successful execution of its Ulta Beauty Unleashed strategy, driving share gains across all categories and channels while deepening customer loyalty. The company continues to differentiate itself through innovative merchandising, exclusive brand launches, experiential marketing, and expansion into international beauty and wellness markets. Strategic investments in digital personalization, supply-chain optimization and Ulta Beauty Marketplace reinforce its leadership as an omnichannel powerhouse. With a strong brand portfolio, loyal customers and a clear growth strategy, Ulta Beauty is well-positioned to maintain market leadership and long-term value.
Ulta Beauty has a trailing four-quarter earnings surprise of 16.3%, on average. The Zacks Consensus Estimate for current financial-year revenues calls for growth of 6.8% from the year-ago reported figure. Shares of this Zacks Rank #3 (Hold) company have rallied 51.4% in the past year.
Price and Consensus: ULTA