It has been about a month since the last earnings report for Ollie's Bargain Outlet (OLLI Quick QuoteOLLI - Free Report) . Shares have added about 19.3% in that time frame, outperforming the S&P 500.

But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is Ollie's Bargain Outlet due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its latest earnings report in order to get a better handle on the important drivers.

OLLI Q2 Earnings Beat Estimates on Tariff Refunds, Sales Miss

Ollie’s Bargain Outlet Holdings, Inc. reported second-quarter fiscal 2026 adjusted earnings of $1.42 per share, which improved 43.4% year over year and beat the Zacks Consensus Estimate of $1.14 by 24.6%. Net sales rose 9.1% to $741.3 million but missed the consensus mark of $753 million by 1.5%. Earnings benefited from IEEPA tariff refunds and lower tariff rates, while the sales increase reflected new-store growth. Comparable-store sales declined 1.8% as average basket size fell, with less favorable weather, consumer pressure and a heightened promotional environment weighing on demand.

OLLI’s Sales Growth Faces Comp Pressure

OLLI opened 15 stores and closed one storm-damaged location during the quarter, ending with 686 stores across 36 states. The store base increased 11.9% from a year earlier and remained the main driver of top-line growth. The company opened 42 stores in the first half of fiscal 2026. Comparable-store transactions were flat, while the average basket declined. Toys, general merchandise, summer furniture, candy and seasonal decor were the strongest categories. Lawn and garden plus room air represented more than 100 basis points of year-over-year comp pressure, with management indicating that the broader drag was more meaningful because those categories also drive store traffic.

Ollie’s Bargain Sees Mixed Consumer Trends

Ollie’s Bargain said lower-income customers continued to prioritize needs over wants, shop closer to need and make fewer trips. Management defined that cohort at a household income of $65,000 or below. Higher-income customers, defined around $100,000 and above, continued to trade down in search of value. Ollie’s Army loyalty membership increased 12.7% to 18.1 million. New customer acquisition also increased, while management highlighted continued momentum among shoppers ages 35 to 55, with particular strength in the 35-45 range. Closeout deal flow remained strong, giving the retailer flexibility to adjust category mix and value.

OLLI’s Margins Get a Tariff Refund Boost

Gross margin expanded 360 basis points to 43.5%. IEEPA tariff refunds contributed 380 basis points, while merchandise margin declined primarily because of price investments. Lower tariff rates more than offset elevated transportation costs. Excluding the refund and related price investment, management said gross margin would have been about 40.3%-40.4%.

SG&A expenses increased 80 basis points as a share of sales to 26.6%, reflecting fixed-cost deleverage from the negative comp and higher marketing costs tied to one additional merchandise flyer. Pre-opening expenses fell 42% to $5.2 million on fewer store openings and lower dark-rent expense.

Ollie’s Bargain Posts Higher Profitability

Adjusted net income increased 40.3% to $85.4 million. Operating income rose 40.9% to $108.5 million, while adjusted EBITDA climbed 35.5% to $127.1 million. Adjusted EBITDA margin widened 330 basis points to 17.1%.

Beyond the tariff benefit, management cited favorable shrink trends and supply-chain efficiencies as additional support to earnings. The Texas distribution-center expansion was completed during the quarter, and operations have normalized. The Illinois facility expansion is expected to begin in the coming months.

OLLI Leverages Balance Sheet to Fund Growth and Buybacks

Total cash and investments reached $507.1 million, up 10.2% year over year, while inventories increased 10.5% to $704.4 million, primarily to support new-store growth. Capital expenditures totaled $43.3 million, with spending focused on new stores, existing-store improvements and the Texas distribution-center expansion.

OLLI repurchased about $84 million of stock in the quarter and $137.3 million in the first half. The company had $121.5 million remaining under its authorization at quarter-end and continued to carry no meaningful long-term debt.

Ollie’s Bargain Resets Sales View, Raises Profit Guide

Ollie’s Bargain lowered its fiscal 2026 net sales outlook to $2.928-$2.941 billion from $2.980-$3.000 billion. Comparable-store sales are now expected to range from flat to up 0.5%, down from the prior view of about 2% growth. The 75-store opening target was maintained, while planned share repurchases increased to about $175 million from $125 million.

The company raised its adjusted earnings outlook to $4.57-$4.65 per share from $4.45-$4.55 and lifted the gross-margin view to about 41.3% from 40.7%. Operating income is now projected at $345-$350 million. Management expects third-quarter comps near flat and fourth-quarter comps up about 1%, while August trends were running ahead of the plan used to set guidance.

How Have Estimates Been Moving Since Then?

It turns out, estimates review have trended downward during the past month.

The consensus estimate has shifted -7.99% due to these changes.

VGM Scores

At this time, Ollie's Bargain Outlet has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a score of C on the value side, putting it in the middle 20% for value investors.

Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Interestingly, Ollie's Bargain Outlet has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Performance of an Industry Player

Ollie's Bargain Outlet belongs to the Zacks Consumer Products - Staples industry. Another stock from the same industry, BJ's Wholesale Club (BJ Quick QuoteBJ - Free Report) , has gained 1.3% over the past month. More than a month has passed since the company reported results for the quarter ended July 2026.

BJ's reported revenues of $6.09 billion in the last reported quarter, representing a year-over-year change of +13.2%. EPS of $1.36 for the same period compares with $1.14 a year ago.

BJ's is expected to post earnings of $1.22 per share for the current quarter, representing a year-over-year change of +5.2%. Over the last 30 days, the Zacks Consensus Estimate has changed +0.1%.

The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for BJ's. Also, the stock has a VGM Score of A.