We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Burlington's (BURL) 2.0 Initiative Paves Way for Long-Term Goal
Read MoreHide Full Article
Burlington Stores, Inc. (BURL - Free Report) has a robust competitive edge on its off-price retail model, adept merchandising capabilities and optimized supply-chain operations, showcasing resilience in the tough operating landscape. The company has demonstrated its ability to navigate uncertainties, capture consumer trends, and foster top-line growth and operating margin expansion.
Adapting to industry changes, BURL's 2.0 initiative focuses on marketing, merchandising and store prototypes to enhance customer value through efficient liquidity management, opportunistic buying, lean inventories and swift stock turnover.
Image Source: Zacks Investment Research
Delving Deeper
A pivotal objective for Burlington Stores is to elevate its operating margin to 10% by fiscal 2028, anticipating improvements through increased sales, enhanced inventory management and targeted cost-reduction strategies, particularly within the supply chain. The company aims for remarkable growth in operating income, reaching $1.6 billion over the next five years — a threefold increase from the projected operating income in fiscal 2023. This strategy underscores the optimization of operational efficiency and capitalizing on growth opportunities.
Reporting a noteworthy 6% year-over-year increase in comparable store sales in the third quarter of fiscal 2023, Burlington Stores attributes this growth to a robust back-to-school season — a critical period for retail sales. Reflecting the success of the company's merchandising strategies and its adept response to consumer demands, this growth sets the stage for strategic expansion.
Burlington Stores envisions a substantial increase in total sales, targeting $16 billion over the next five years, indicating 60% aggregate growth from that reported in fiscal 2023. Rooted in expanding its customer base and enhancing product offerings, this ambitious goal is accompanied by an aggressive expansion plan, intending to open 500 stores in the next five years. The company aims to maximize profitability, focusing on smaller, 25,000-square-foot stores in high-traffic strip malls, and strategically relocating or downsizing older, less efficient stores.
Despite the expected variability, Burlington Stores anticipates mid-single-digit average annual comp sales growth over the next five years. The company's strategies to embrace an off-price approach, and the positive impacts of new store and relocation programs are pivotal factors contributing to this anticipated growth.
Zacks Rank and Estimates
This Zacks Rank #3 (Hold) stock has outpaced the Zacks Retail - Discount Stores industry over the past three months. In the said period, shares of the company have gained 55.6% compared with the industry’s growth of 18%.
Also, analysts seem optimistic about the stock. The Zacks Consensus Estimate for fiscal 2023 sales and earnings per share (EPS) is pegged at $9.61 billion and $5.73, respectively. These estimates indicate year-over-year increases of 10.4% and 34.5%, respectively.
To wrap up, Burlington Stores is strategically positioning itself for robust growth and enhanced profitability. Through efficient supply-chain management, a focused off-price retail model under Burlington 2.0 and aggressive store expansion, the company is set to significantly increase its operational efficiency and market presence, aiming for substantial growth in sales and operating margins in the coming years.
The Zacks Consensus Estimate for Ross Stores’ current fiscal-year earnings and sales indicates growth of 22.4% and 7.5%, respectively, from the fiscal 2022 reported figures. ROST has a trailing four-quarter average earnings surprise of 7.8%.
Target has evolved from being a pure brick-and-mortar retailer to an omni-channel entity. The company carries a Zacks Rank #2 at present.
The Zacks Consensus Estimate for Target’s current fiscal-year earnings implies growth of 38.5% from the fiscal 2022 reported number. TGT has a trailing four-quarter average earnings surprise of 30.8%.
TJX Companies is a leading off-price retailer of apparel and home fashions in the United States and worldwide. It currently carries a Zacks Rank #2.
The Zacks Consensus Estimate for TJX Companies’ current fiscal-year earnings and sales indicates growth of 20.6% and 8%, respectively, from the fiscal 2023 reported figures. TJX has a trailing four-quarter average earnings surprise of 6.3%.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Burlington's (BURL) 2.0 Initiative Paves Way for Long-Term Goal
Burlington Stores, Inc. (BURL - Free Report) has a robust competitive edge on its off-price retail model, adept merchandising capabilities and optimized supply-chain operations, showcasing resilience in the tough operating landscape. The company has demonstrated its ability to navigate uncertainties, capture consumer trends, and foster top-line growth and operating margin expansion.
Adapting to industry changes, BURL's 2.0 initiative focuses on marketing, merchandising and store prototypes to enhance customer value through efficient liquidity management, opportunistic buying, lean inventories and swift stock turnover.
Image Source: Zacks Investment Research
Delving Deeper
A pivotal objective for Burlington Stores is to elevate its operating margin to 10% by fiscal 2028, anticipating improvements through increased sales, enhanced inventory management and targeted cost-reduction strategies, particularly within the supply chain. The company aims for remarkable growth in operating income, reaching $1.6 billion over the next five years — a threefold increase from the projected operating income in fiscal 2023. This strategy underscores the optimization of operational efficiency and capitalizing on growth opportunities.
Reporting a noteworthy 6% year-over-year increase in comparable store sales in the third quarter of fiscal 2023, Burlington Stores attributes this growth to a robust back-to-school season — a critical period for retail sales. Reflecting the success of the company's merchandising strategies and its adept response to consumer demands, this growth sets the stage for strategic expansion.
Burlington Stores envisions a substantial increase in total sales, targeting $16 billion over the next five years, indicating 60% aggregate growth from that reported in fiscal 2023. Rooted in expanding its customer base and enhancing product offerings, this ambitious goal is accompanied by an aggressive expansion plan, intending to open 500 stores in the next five years. The company aims to maximize profitability, focusing on smaller, 25,000-square-foot stores in high-traffic strip malls, and strategically relocating or downsizing older, less efficient stores.
Despite the expected variability, Burlington Stores anticipates mid-single-digit average annual comp sales growth over the next five years. The company's strategies to embrace an off-price approach, and the positive impacts of new store and relocation programs are pivotal factors contributing to this anticipated growth.
Zacks Rank and Estimates
This Zacks Rank #3 (Hold) stock has outpaced the Zacks Retail - Discount Stores industry over the past three months. In the said period, shares of the company have gained 55.6% compared with the industry’s growth of 18%.
Also, analysts seem optimistic about the stock. The Zacks Consensus Estimate for fiscal 2023 sales and earnings per share (EPS) is pegged at $9.61 billion and $5.73, respectively. These estimates indicate year-over-year increases of 10.4% and 34.5%, respectively.
To wrap up, Burlington Stores is strategically positioning itself for robust growth and enhanced profitability. Through efficient supply-chain management, a focused off-price retail model under Burlington 2.0 and aggressive store expansion, the company is set to significantly increase its operational efficiency and market presence, aiming for substantial growth in sales and operating margins in the coming years.
3 Red-Hot Stocks to Consider
A few better-ranked stocks are Ross Stores Inc. (ROST - Free Report) , Target Corporation (TGT - Free Report) and The TJX Companies, Inc. (TJX - Free Report) .
Ross Stores operates as an off-price retailer of apparel and home accessories, primarily in the United States. The company currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
The Zacks Consensus Estimate for Ross Stores’ current fiscal-year earnings and sales indicates growth of 22.4% and 7.5%, respectively, from the fiscal 2022 reported figures. ROST has a trailing four-quarter average earnings surprise of 7.8%.
Target has evolved from being a pure brick-and-mortar retailer to an omni-channel entity. The company carries a Zacks Rank #2 at present.
The Zacks Consensus Estimate for Target’s current fiscal-year earnings implies growth of 38.5% from the fiscal 2022 reported number. TGT has a trailing four-quarter average earnings surprise of 30.8%.
TJX Companies is a leading off-price retailer of apparel and home fashions in the United States and worldwide. It currently carries a Zacks Rank #2.
The Zacks Consensus Estimate for TJX Companies’ current fiscal-year earnings and sales indicates growth of 20.6% and 8%, respectively, from the fiscal 2023 reported figures. TJX has a trailing four-quarter average earnings surprise of 6.3%.