I’ll never forget a few years back when I dropped my wife off at an Ulta Beauty Inc (NASDAQ:ULTA) shop. It was like a vision, a field of dreams. Clearly, ULTA isn’t the kind of store I frequent, but the first time I saw it I actually wanted to go inside.

Now this may seem like an odd thing for me to remember — or at least to admit to remembering — and I’m sure you’re wondering why I’m bringing this up in an article about investing.

The reason is that I’m always advocating to buy what you know. I’m not exactly ULTA’s biggest customer, but one thing I do know is that this is a company that’s killing the game in the beauty industry.

ULTA is the largest beauty retailer in the United States, and it has to be one of the most amazing one-stop shops for women. The company offers more than 20,000 cosmetic, fragrance, skin and hair care products from over 500 brands across all price points. It also has its own private label. The company has an online presence as well as more than a thousand stores in 48 states, and each one offers a full-service salon.

Management has a solid execution history, having beat the Street in each quarter over the last three years. The fourth-quarter report is expected out on this afternoon, and analysts are looking for earnings of $2.79 a share to be up from $2.24 a share last year on 23% revenue growth to $1.94 billion.

That strength should carry through to the full year, and in 2018 Wall Street expects 30% growth on the bottom line and a 14% increase on the top.

Buying Ulta Stock at a Steal

This stock has been on my radar since it was trading in the $50 range back in 2011 and I’m still not done pounding the table here. In fact, a recent pullback in the shares is providing us an opportunity to buy in at a more than 15% discount from the January high above $240.

I know there have been some stories recently about repackaged products, but I don’t think this is a company issue and it certainly shouldn’t be long-lasting. In the meantime, ULTA is bouncing off longer-term support at $200, and over time I see it heading back to $250 and possibly higher.

All that said, I do want to note that this position carries higher-than-average risk. However, I believe it’s worth taking on for the major potential reward.

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