Deutsche Bank's Mike Baker said Amazon's ambitions have, so far this year, impacted the apparel, auto parts, grocery and sporting goods spaces. But, if Amazon's next move is to expand within the beauty space, Ulta is in fact better positioned than other retailers to take on the e-commerce giant for three reasons.

Ulta boasts:

1. Better access to leading brands.
2. Better pricing.
3. Better web functionality.

In fact, among a selection of 43 brands available at Ulta, Amazon only sells 28; only five of those are sold through first party with the rest in the marketplace. Moreover, 18 of the 28 products were priced higher on Amazon, with the average gap greater than 20 percent.

Baker maintains a Hold rating on Ulta's stock with an unchanged $300 price target, despite the pullback, as the stock still appears to be expensive. However, the pullback does "warrant a second look."

Ulta's new store is consistent with its typical suburban stores with a few notable differences, including:

1. Video displays near the entrance and the salon.
2. Higher quality fixtures in many departments.
3. Tile floors instead of "faux wood."
4. Additional seats in the salon.

The store also contains new brands and an overall greater in-store experience, which indicates that management has "no intention of resting on its laurels" after several quarters of impressive growth, the analyst added. In fact, this also indicates there are multiple future growth drivers ahead, which bodes well for the bullish case in owning the stock.

Shares of Ulta are currently trading at 34.4x the analyst's fiscal 2017 diluted earnings per share estimate, which represents a significant premium to its peers but in line with its own historical levels. A $350 price target also implies the stock will continue trading in line with its historical value and will move higher when investors transition to valuing the stock on its 2018 estimates as opposed to 2017's numbers.