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Burlington Stores' Growth Plans, Store Expansion Bode Well
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Technology has been playing a major role in shaping the retail landscape. Retailers are fast adopting the omni-channel mantra to provide a seamless shopping experience, online and at stores. To keep up with the altering scenario, Burlington Stores, Inc. (BURL - Free Report) has made multiple changes to its business model. Further, in order to drive the top line, this company has been focusing on store expansion.
The company’s off-price business model is helping customers to get nationally branded, fashionable and high-quality products at the right price. Over the years, the company has increased vendor counts, made technological advancements, adopted a better marketing approach and focused on localized assortments.
Apart from these, the company has been quite rational when it comes to store opening. The store count has increased from 13 in 1980 to 629 stores in fiscal 2017. In fiscal 2014, 2015, 2016 and 2017, the company opened 37, 24, 28 and 30 stores, respectively. Further, it has remodeled 34 stores in fiscal 2017. The company plans to open 35 to 40 net new stores and remodel 34 in fiscal 2018. It also believes that there is room to increase the store count to 1,000.
Burlington Stores has been doing quite well on the revenue front. In the first quarter of fiscal 2018, the top line improved 12.8% following an increase of 14.9% in the preceding quarter. Meanwhile, comparable store sales have increased a respective 3.4%, 4.5%, 2.1% and 4.9% in fiscal 2017, 2016, 2015 and 2014. Management projects comps growth in the range of 2.6-3.4% for fiscal 2018. Total sales are projected to increase 9.7-10.5%.
Higher sales, margin expansion, cost control and lower tax rates prompted management to lift the fiscal 2018 view. The company now envisions second-quarter earnings in the band of 91-95 cents and fiscal 2018 earnings in the range of $5.90-$6.00. The company had earlier projected fiscal 2018 adjusted earnings per share between $5.73 and $5.83.
Further, the company expects second-quarter sales growth of 8-9% and comps growth of 2-3%. The company forecasts adjusted earnings a share in the range of 91-95 cents, compared with 72 cents in the year-ago quarter.
These endeavors have helped the company gain investor confidence. Shares of this Zacks Rank #2 (Buy) have risen 24.3%, outperforming the industry's rally of 9.9% and the S&P 500’s rise of 0.6% in the past six months.
Shoe Carnival (SCVL - Free Report) delivered an average positive earnings surprise of 21.3% in the last four quarters. It has a long-term earnings growth rate of 12% and a Zacks Rank #1.
Fossil Group (FOSL - Free Report) delivered an average positive earnings surprise of 54.1% in the trailing four quarters. It has a long-term earnings growth rate of 5% and a Zacks Rank #2.
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Burlington Stores' Growth Plans, Store Expansion Bode Well
Technology has been playing a major role in shaping the retail landscape. Retailers are fast adopting the omni-channel mantra to provide a seamless shopping experience, online and at stores. To keep up with the altering scenario, Burlington Stores, Inc. (BURL - Free Report) has made multiple changes to its business model. Further, in order to drive the top line, this company has been focusing on store expansion.
The company’s off-price business model is helping customers to get nationally branded, fashionable and high-quality products at the right price. Over the years, the company has increased vendor counts, made technological advancements, adopted a better marketing approach and focused on localized assortments.
Apart from these, the company has been quite rational when it comes to store opening. The store count has increased from 13 in 1980 to 629 stores in fiscal 2017. In fiscal 2014, 2015, 2016 and 2017, the company opened 37, 24, 28 and 30 stores, respectively. Further, it has remodeled 34 stores in fiscal 2017. The company plans to open 35 to 40 net new stores and remodel 34 in fiscal 2018. It also believes that there is room to increase the store count to 1,000.
Burlington Stores has been doing quite well on the revenue front. In the first quarter of fiscal 2018, the top line improved 12.8% following an increase of 14.9% in the preceding quarter. Meanwhile, comparable store sales have increased a respective 3.4%, 4.5%, 2.1% and 4.9% in fiscal 2017, 2016, 2015 and 2014. Management projects comps growth in the range of 2.6-3.4% for fiscal 2018. Total sales are projected to increase 9.7-10.5%.
Higher sales, margin expansion, cost control and lower tax rates prompted management to lift the fiscal 2018 view. The company now envisions second-quarter earnings in the band of 91-95 cents and fiscal 2018 earnings in the range of $5.90-$6.00. The company had earlier projected fiscal 2018 adjusted earnings per share between $5.73 and $5.83.
Further, the company expects second-quarter sales growth of 8-9% and comps growth of 2-3%. The company forecasts adjusted earnings a share in the range of 91-95 cents, compared with 72 cents in the year-ago quarter.
These endeavors have helped the company gain investor confidence. Shares of this Zacks Rank #2 (Buy) have risen 24.3%, outperforming the industry's rally of 9.9% and the S&P 500’s rise of 0.6% in the past six months.
Other Stocks to Consider
Urban Outfitters (URBN - Free Report) delivered an average positive earnings surprise of 19.8% in the trailing four quarters. It has a long-term earnings growth rate of 12% and a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Shoe Carnival (SCVL - Free Report) delivered an average positive earnings surprise of 21.3% in the last four quarters. It has a long-term earnings growth rate of 12% and a Zacks Rank #1.
Fossil Group (FOSL - Free Report) delivered an average positive earnings surprise of 54.1% in the trailing four quarters. It has a long-term earnings growth rate of 5% and a Zacks Rank #2.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot trades we're targeting>>