Yahoo Finance Here's Why Burlington Stores (BURL) Looks a Promising Pick
Burlington Stores, Inc. BURL has adeptly responded to the challenges in the retail landscape by strategically emphasizing recognizable brands, implementing the best pricing strategy and targeting trade-down shoppers. The implementation of strategic initiatives aimed at enhancing merchandising capabilities, operational efficiency and store optimization is likely to support revenue growth.
By focusing on initiatives such as store relocations and downsizing, Burlington Stores aims to improve store productivity. The ability to quickly respond to evolving market dynamics and adjust inventory levels based on real-time data insights has enabled the company to seize opportunities.
The upward trend in the Zacks Consensus Estimate reaffirms investor confidence in Burlington Stores' growth prospects. Over the past 30 days, the Zacks Consensus Estimate for earnings per share for the current and next fiscal years has increased by 1 cent and 2 cents, reaching $7.41 and $9.11, respectively. Similarly, the Zacks Consensus Estimate for sales for the current and next fiscal year stands at $10.72 billion and $11.85 billion, which indicates year-over-year growth of 10.2% and 10.6%, respectively.
Let’s Delve Deeper
Burlington Stores' success in catering to a diverse customer base is a key factor driving its growth. From lower-income shoppers seeking value deals to slightly higher-income customers looking for recognizable brands, the company's ability to target different segments effectively positions it for sustained success. The company’s focus on offering compelling values at opening price points and targeting trade-down shoppers has been instrumental in driving incremental comps growth.
Management's acknowledgment of opportunities to drive even stronger performance indicates a proactive stance toward growth. With plans to offer stronger and more compelling values, Burlington Stores is poised to capitalize on untapped market opportunities and enhance shareholder value.
Looking ahead, Burlington Stores sets ambitious targets for total sales growth over the next five years, aiming to reach approximately $16 billion. This reflects the company's confidence in its ability to expand its customer base, capture market share and capitalize on emerging opportunities in the retail landscape.
Central to its growth strategy is the expansion of its store footprint. The company plans to open approximately 100 net new stores annually, supplemented by relocations of older, less productive stores. By strategically positioning its stores in high-traffic areas and optimizing store layouts, Burlington aims to enhance its accessibility and reach new demographics.
Anticipating average comp sales growth in the mid-single digits over the next five years, Burlington Stores remains confident in its ability to drive traffic, enhance customer loyalty and adapt to evolving consumer preferences through strategic initiatives. Additionally, the company aims to leverage higher sales volumes and cost-saving opportunities to grow operating margins to 10%, thereby enhancing profitability and creating value for shareholders.
Wrapping Up
In summary, Burlington Stores' strategic initiatives, adaptability and ambitious growth targets position it as a promising investment in the retail sector. This Zacks Rank #1 (Strong buy) stock has outperformed the industry in the past six months. Shares of the company have gained 51.1% compared with the industry’s growth of 25.2%.
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3 Picks You Can’t Miss
We have highlighted three other top-ranked stocks in the broader sector, namely Abercrombie & Fitch Co. ANF, The Gap, Inc. GPS and DICK’S Sporting Goods DKS.
Abercrombie, a leading casual apparel retailer, currently sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for ANF’s current financial-year sales and earnings suggests growth of 5.6% and 19.1%, respectively, from the year-ago reported figures. Abercrombie has a trailing four-quarter earnings surprise of 715.6%, on average.
Gap, a leading apparel retailer, currently sports a Zacks Rank #1. GPS has a trailing four-quarter earnings surprise of 180.9%, on average.
The Zacks Consensus Estimate for GPS’ current financial-year sales and earnings suggests a decline of 0.3% and 4.9%, respectively, from the year-ago reported figures.
DICK’S Sporting operates as an omni-channel sporting goods retailer. It currently carries a Zacks Rank #2 (Buy). DKS has a trailing four-quarter earnings surprise of 3.1%, on average.
The Zacks Consensus Estimate for DICK’S Sporting’s current fiscal-year sales and earnings suggests growth of 1.3% and 2.8%, respectively, from the year-ago reported numbers.
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Abercrombie & Fitch Company (ANF) : Free Stock Analysis Report
The Gap, Inc. (GPS) : Free Stock Analysis Report
DICK'S Sporting Goods, Inc. (DKS) : Free Stock Analysis Report
Burlington Stores, Inc. (BURL) : Free Stock Analysis Report
