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 Stores (BURL) Q3 Earnings Beat, Revenues Miss
Read MoreHide Full Article
Burlington Stores, Inc. (BURL - Free Report) continued with its positive earnings surprise streak in the third quarter of fiscal 2017. However, net sales fell short of the Zacks Consensus Estimate, after surpassing the same in the preceding quarter.
This off-price retailer posted adjusted earnings of 70 cents a share that beat the Zacks Consensus Estimate of 65 cents and surged from 51 cents delivered in the year-ago period. Higher sales, margin expansion, cost control and share repurchase activity drove the bottom line.
Net sales of this Zacks Rank #3 (Hold) company came in at $1,438.2 million, increasing 7.1% year over year but falling short of the consensus mark of $1,441.1 million. Comparable store sales (comps) rose 3.1% during the quarter compared with 3.7% growth registered in the year-ago quarter.
This was the 19th straight quarter of comps growth, and the reflection of the same is quite visible from the stock’s performance. So far in the year, the stock has risen 23.8% comfortably outperforming the industry’s gain 2.9%.
Gross margin increased 100 basis points to 42.2% mainly owing to higher merchandise margin. Adjusted operating income increased 29% to $88.9 million, while operating margin grew 104 basis points to 6.2%.
Adjusted EBITDA soared 22.2% to $133.9 million, while EBITDA margin as a percentage of sales, expanded 115 basis points to 9.3% on account of higher gross margin. Management now anticipates adjusted EBITDA margin expansion of 80-90 basis points in fiscal 2017.
Burlington Stores now intends to focus more on categories such as home, beauty and ladies apparel. Further, the company remodeled 34 stores in fiscal 2017. During the quarter, the company opened 31 net new stores, and plans to open an outlet and close four by the end of the final quarter. Management informed that new and non-comp outlets contributed $60 million to the third-quarter sales. The company plans to open 37 net new stores. Further, it believes that there is room to increase the store count to 1,000.
Burlington Stores, Inc. Price, Consensus and EPS Surprise
Burlington Stores ended the quarter with cash and cash equivalents of $48.1 million, long-term debt (excluding current maturities) of $1,294.3 million and shareholders’ deficit of $110.5 million. For fiscal 2017, the company projects net capital expenditures of approximately $215 million.
During the quarter, the company bought back 804,577 shares worth $70 million, of which $39 million was remaining under the previous share buyback program and $31 million was done under the new $300 million authorization announced on Aug 16, 2017. At the end of the quarter, the company had $269 million remaining under its current share buyback program.
Outlook
Management now expects total sales to increase in the band of 8.1-8.4%, including 1.4% from the 53rd week during fiscal 2017. Earlier, the company had forecast total sales growth of 8.4-8.9%. The fall in the rate of growth is attributable to the closure of 19 stores in the third quarter and expected closure of eight stores in the fourth quarter, lowering sales by $17 million and $25 million, respectively.
The company projects comps growth of 2-3% for the final quarter, resulting in comps increase of 2.3-2.6% for the fiscal year. Burlington Stores forecasts total sales increase of 11-12%, including 5% from the 53rd week for the fourth quarter.
The company now envisions fiscal 2017 adjusted earnings in the range of $4.23-$4.27 per share compared with $3.24 reported in the prior year. This includes an expected benefit of 4 cents on account of the 53rd week and 20 cents a share related to the accounting change for share-based compensation. For the fourth quarter, earnings are expected to come within the range of $2.02-$2.06 per share compared with $1.78 reported in the prior-year period.
The current Zacks Consensus Estimate for the final quarter and fiscal 2017 is currently pegged at $2.08 and $4.24, respectively.
Looking for More? Check These 3 Trending Retail Stocks
Ross Stores, Inc. (ROST - Free Report) pulled off an average positive earnings surprise of 5.5% in the trailing four quarters. It has a long-term earnings growth rate of 10% and a Zacks Rank #2.
The Children's Place, Inc. (PLCE - Free Report) delivered an average positive earnings surprise of 14% in the trailing four quarters. It has a long-term earnings growth rate of 9% and a Zacks Rank #2.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
Image: Bigstock
Burlington Stores (BURL) Q3 Earnings Beat, Revenues Miss
Burlington Stores, Inc. (BURL - Free Report) continued with its positive earnings surprise streak in the third quarter of fiscal 2017. However, net sales fell short of the Zacks Consensus Estimate, after surpassing the same in the preceding quarter.
This off-price retailer posted adjusted earnings of 70 cents a share that beat the Zacks Consensus Estimate of 65 cents and surged from 51 cents delivered in the year-ago period. Higher sales, margin expansion, cost control and share repurchase activity drove the bottom line.
Net sales of this Zacks Rank #3 (Hold) company came in at $1,438.2 million, increasing 7.1% year over year but falling short of the consensus mark of $1,441.1 million. Comparable store sales (comps) rose 3.1% during the quarter compared with 3.7% growth registered in the year-ago quarter.
This was the 19th straight quarter of comps growth, and the reflection of the same is quite visible from the stock’s performance. So far in the year, the stock has risen 23.8% comfortably outperforming the industry’s gain 2.9%.
Gross margin increased 100 basis points to 42.2% mainly owing to higher merchandise margin. Adjusted operating income increased 29% to $88.9 million, while operating margin grew 104 basis points to 6.2%.
Adjusted EBITDA soared 22.2% to $133.9 million, while EBITDA margin as a percentage of sales, expanded 115 basis points to 9.3% on account of higher gross margin. Management now anticipates adjusted EBITDA margin expansion of 80-90 basis points in fiscal 2017.
Burlington Stores now intends to focus more on categories such as home, beauty and ladies apparel. Further, the company remodeled 34 stores in fiscal 2017. During the quarter, the company opened 31 net new stores, and plans to open an outlet and close four by the end of the final quarter. Management informed that new and non-comp outlets contributed $60 million to the third-quarter sales. The company plans to open 37 net new stores. Further, it believes that there is room to increase the store count to 1,000.
Burlington Stores, Inc. Price, Consensus and EPS Surprise
Burlington Stores, Inc. Price, Consensus and EPS Surprise | Burlington Stores, Inc. Quote
Other Financial Aspects
Burlington Stores ended the quarter with cash and cash equivalents of $48.1 million, long-term debt (excluding current maturities) of $1,294.3 million and shareholders’ deficit of $110.5 million. For fiscal 2017, the company projects net capital expenditures of approximately $215 million.
During the quarter, the company bought back 804,577 shares worth $70 million, of which $39 million was remaining under the previous share buyback program and $31 million was done under the new $300 million authorization announced on Aug 16, 2017. At the end of the quarter, the company had $269 million remaining under its current share buyback program.
Outlook
Management now expects total sales to increase in the band of 8.1-8.4%, including 1.4% from the 53rd week during fiscal 2017. Earlier, the company had forecast total sales growth of 8.4-8.9%. The fall in the rate of growth is attributable to the closure of 19 stores in the third quarter and expected closure of eight stores in the fourth quarter, lowering sales by $17 million and $25 million, respectively.
The company projects comps growth of 2-3% for the final quarter, resulting in comps increase of 2.3-2.6% for the fiscal year. Burlington Stores forecasts total sales increase of 11-12%, including 5% from the 53rd week for the fourth quarter.
The company now envisions fiscal 2017 adjusted earnings in the range of $4.23-$4.27 per share compared with $3.24 reported in the prior year. This includes an expected benefit of 4 cents on account of the 53rd week and 20 cents a share related to the accounting change for share-based compensation. For the fourth quarter, earnings are expected to come within the range of $2.02-$2.06 per share compared with $1.78 reported in the prior-year period.
The current Zacks Consensus Estimate for the final quarter and fiscal 2017 is currently pegged at $2.08 and $4.24, respectively.
Looking for More? Check These 3 Trending Retail Stocks
Dollar Tree, Inc. (DLTR - Free Report) has a long-term earnings growth rate of 13.2% and a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Ross Stores, Inc. (ROST - Free Report) pulled off an average positive earnings surprise of 5.5% in the trailing four quarters. It has a long-term earnings growth rate of 10% and a Zacks Rank #2.
The Children's Place, Inc. (PLCE - Free Report) delivered an average positive earnings surprise of 14% in the trailing four quarters. It has a long-term earnings growth rate of 9% and a Zacks Rank #2.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
Click for details >>