Ollie's Bargain Outlet rises on market strength
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Aug 28 2024
0mins
Should l Buy OLLI?
Source: Business Insider
Ollie's Bargain Outlet Holdings Inc. saw a price increase of 5.01%, reaching a 5-day high amid positive market conditions.
This rise is attributed to broad market strength, with the Nasdaq-100 up 0.80% and the S&P 500 up 0.66%, indicating a favorable environment for stocks. The stock's performance reflects investor confidence in the retail sector, which has been buoyed by recent economic data.
The upward movement suggests that Ollie's Bargain Outlet is benefiting from the overall market trend, positioning itself well for future growth as consumer spending remains robust.
Trade with 70% Backtested Accuracy
Stop guessing "Should I Buy OLLI?" and start using high-conviction signals backed by rigorous historical data.
Sign up today to access powerful investing tools and make smarter, data-driven decisions.
Analyst Views on OLLI
Wall Street analysts forecast OLLI stock price to rise
13 Analyst Rating
10 Buy
3 Hold
0 Sell
Strong Buy
Current: 106.670
Low
120.00
Averages
144.46
High
162.00
Current: 106.670
Low
120.00
Averages
144.46
High
162.00
About OLLI
Ollie's Bargain Outlet Holdings, Inc. operates as a retailer of closeout merchandise and excess inventory. The Company and its subsidiaries principally buys overproduced, overstocked, and closeout merchandise from manufacturers, wholesalers, distributors, brokers, and other retailers. In addition, it augments its name-brand closeout deals with private label products. It offers customers a selection of brand name products, including housewares, bed and bath, food, floor coverings, health and beauty aids, books and stationery, toys, and electronics. The Company operates over 575 stores in 31 states. The Company's retail locations are located in Alabama, Arkansas, Connecticut, Delaware, Florida, Georgia, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maryland, Massachusetts, Michigan, Mississippi, Missouri, New Jersey, New York, North Carolina, Ohio, Oklahoma, Pennsylvania, Rhode Island, South Carolina, Tennessee, Texas, Vermont, Virginia, and West Virginia.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Ollie's Bargain Outlet Set to Release Q4 Earnings on March 12
- Earnings Announcement Preview: Ollie's Bargain Outlet is set to announce its Q4 earnings on March 12 before market open, with consensus EPS estimated at $1.41, reflecting an 18.5% year-over-year increase, and revenue expected at $783.71 million, up 17.5%, indicating solid performance in the retail sector.
- Historical Performance Review: Over the past two years, Ollie's has exceeded EPS estimates 75% of the time and revenue estimates 50% of the time, demonstrating a degree of reliability and stability in its financial performance.
- Expectation Revision Dynamics: In the last three months, EPS estimates have seen 10 upward revisions and 3 downward adjustments, while revenue estimates experienced 12 upward revisions and 1 downward, indicating growing analyst confidence in the company's future performance.
- Market Analysis Insights: Despite facing a 'noisy' Q1, RBC Capital believes that Ollie's growth potential for 2026 is underappreciated by investors, while Loop Capital rates it as a buy based on expansion, merchandise, and seasonal assortment, reflecting optimism about its long-term growth prospects.
See More
Ollie’s Bargain Outlet Q4 Earnings Preview
- Optimistic Earnings Outlook: Ollie’s is projected to report an adjusted profit of $1.41 per share and sales of $783.7 million for Q4, representing year-over-year increases of 18% and 17%, indicating strong recovery potential.
- Sales Growth Drivers: RBC Capital analyst Steven Shemesh anticipates a 3.5% increase in comparable sales, driven by robust performance in the second half of December, despite December typically being the toughest comparison month of the quarter.
- Positive Future Outlook: Shemesh believes investors underestimate Ollie’s earnings power, arguing that concerns over Big Lots’ market share gains should not be viewed as a one-time event, as customer conversion from Big Lots may take several years.
- Price Target Adjustment: Shemesh maintains an Outperform rating on Ollie’s with a price target of $147, representing a 35% upside from Friday's close, reflecting confidence in the company's future growth prospects.
See More
Summary of Earnings Season for U.S. Retailers
- Amazon's Investment Outlook: Amazon's commitment to $200 billion in capital expenditures for 2023, despite a P/E ratio of 30 close to the S&P 500 average, suggests strong growth potential, with net income expected to rise 31% to $78 billion by 2025, highlighting its robust position in e-commerce and cloud computing.
- Ollie's Expansion Strategy: Ollie's Bargain Outlet achieved a 17% revenue increase in the past nine months, with net income reaching $155 million, and although its stock performance has been flat due to rapid expansion, its goal of opening over 1,000 stores in the U.S. indicates confidence in future growth.
- Impact of Target's CEO Change: Following challenges with excess inventory and declining sales, new CEO Michael Fiddelke forecasts a 2% net sales growth for 2026 and plans to revamp stores and enhance product selection, potentially leading to significant shareholder returns.
- Dividend Yield Advantage: Despite a more than 9% drop in net income, Target maintains a 3.7% dividend yield, significantly above the S&P 500's 1.2%, and has a 54-year streak of dividend increases, demonstrating stability in an uncertain economic environment.
See More
Amazon Investment Opportunities Amid Retail Market Dynamics
- Amazon's Capital Expenditure: Amazon's commitment to $200 billion in capital expenditures for 2023 may unsettle investors; however, its cloud computing arm, AWS, remains the primary income source, expected to support future AI developments and enhance overall profitability.
- Ollie's Expansion Strategy: Ollie's Bargain Outlet is rapidly expanding from a regional chain to a national presence through acquisitions like Big Lots and 99 Cents Only, currently operating about 645 stores with a goal of over 1,000, and reporting a 17% year-over-year revenue increase in the first fiscal quarter, indicating strong market demand.
- Target's New Leadership Hope: New CEO Michael Fiddelke, who took office on February 1, 2023, forecasts a 2% net sales growth for 2026 and plans to restore brand image through store renovations and improved product selection, despite a more than 9% drop in net income for fiscal 2025.
- Dividend Yield and Valuation: Target maintains a 54-year streak of dividend increases, with a current yield of 3.7%, significantly above the S&P 500's 1.2%; if its strategic plan succeeds, it could yield substantial returns for shareholders, with a P/E of 15, lower than Walmart's 47.
See More
Consumer Staples Industry Outlook and Opportunities
- Strategic Optimization Drives Growth: Companies in the consumer staples sector are leveraging strategic optimization initiatives to focus on higher-growth, higher-return categories, particularly in e-commerce and health-focused innovations, thereby enhancing their competitive positioning.
- Stable Demand Supports Industry: Despite shifting consumer spending patterns, the stable demand for essential products ensures resilience in the industry, providing companies with a consistent revenue stream from core offerings.
- Cost Pressures Impact Margins: Rising costs in raw materials, labor, and transportation are squeezing profit margins, prompting many firms to implement restructuring and cost-cutting strategies to improve operational efficiency in response to these challenges.
- Optimistic Industry Outlook: The Zacks Consumer Products industry ranks 74th, placing it in the top 31% of industries, indicating a positive earnings outlook, although the sector has underperformed the broader market in the past six months, it still holds potential for future growth.
See More
Ollie's Bargain Outlet Stock Oversold Signal
- Oversold Indicator: Ollie's Bargain Outlet shares hit an RSI of 29.2 on Monday, indicating an oversold condition that suggests recent heavy selling may be exhausting, prompting investors to consider buying opportunities.
- Price Fluctuation: The stock traded as low as $101.40 per share, with the current price at $101.45, which is close to its 52-week low of $97.04, indicating some price support.
- Market Comparison: Compared to the S&P 500 ETF's RSI of 47.3, Ollie's oversold status may attract investors looking for a rebound, highlighting a divergence in market sentiment.
- Historical Performance: Over the past year, Ollie's shares reached a high of $141.74 per share, and the current price still shows a significant gap from this historical peak, potentially offering investors upside opportunities.
See More
Ollie's Bargain Outlet Set to Release Q4 Earnings on March 12
- Earnings Announcement Preview: Ollie's Bargain Outlet is set to announce its Q4 earnings on March 12 before market open, with consensus EPS estimated at $1.41, reflecting an 18.5% year-over-year increase, and revenue expected at $783.71 million, up 17.5%, indicating solid performance in the retail sector.
- Historical Performance Review: Over the past two years, Ollie's has exceeded EPS estimates 75% of the time and revenue estimates 50% of the time, demonstrating a degree of reliability and stability in its financial performance.
- Expectation Revision Dynamics: In the last three months, EPS estimates have seen 10 upward revisions and 3 downward adjustments, while revenue estimates experienced 12 upward revisions and 1 downward, indicating growing analyst confidence in the company's future performance.
- Market Analysis Insights: Despite facing a 'noisy' Q1, RBC Capital believes that Ollie's growth potential for 2026 is underappreciated by investors, while Loop Capital rates it as a buy based on expansion, merchandise, and seasonal assortment, reflecting optimism about its long-term growth prospects.
See More
Ollie’s Bargain Outlet Q4 Earnings Preview
- Optimistic Earnings Outlook: Ollie’s is projected to report an adjusted profit of $1.41 per share and sales of $783.7 million for Q4, representing year-over-year increases of 18% and 17%, indicating strong recovery potential.
- Sales Growth Drivers: RBC Capital analyst Steven Shemesh anticipates a 3.5% increase in comparable sales, driven by robust performance in the second half of December, despite December typically being the toughest comparison month of the quarter.
- Positive Future Outlook: Shemesh believes investors underestimate Ollie’s earnings power, arguing that concerns over Big Lots’ market share gains should not be viewed as a one-time event, as customer conversion from Big Lots may take several years.
- Price Target Adjustment: Shemesh maintains an Outperform rating on Ollie’s with a price target of $147, representing a 35% upside from Friday's close, reflecting confidence in the company's future growth prospects.
See More
Summary of Earnings Season for U.S. Retailers
- Amazon's Investment Outlook: Amazon's commitment to $200 billion in capital expenditures for 2023, despite a P/E ratio of 30 close to the S&P 500 average, suggests strong growth potential, with net income expected to rise 31% to $78 billion by 2025, highlighting its robust position in e-commerce and cloud computing.
- Ollie's Expansion Strategy: Ollie's Bargain Outlet achieved a 17% revenue increase in the past nine months, with net income reaching $155 million, and although its stock performance has been flat due to rapid expansion, its goal of opening over 1,000 stores in the U.S. indicates confidence in future growth.
- Impact of Target's CEO Change: Following challenges with excess inventory and declining sales, new CEO Michael Fiddelke forecasts a 2% net sales growth for 2026 and plans to revamp stores and enhance product selection, potentially leading to significant shareholder returns.
- Dividend Yield Advantage: Despite a more than 9% drop in net income, Target maintains a 3.7% dividend yield, significantly above the S&P 500's 1.2%, and has a 54-year streak of dividend increases, demonstrating stability in an uncertain economic environment.
See More
Amazon Investment Opportunities Amid Retail Market Dynamics
- Amazon's Capital Expenditure: Amazon's commitment to $200 billion in capital expenditures for 2023 may unsettle investors; however, its cloud computing arm, AWS, remains the primary income source, expected to support future AI developments and enhance overall profitability.
- Ollie's Expansion Strategy: Ollie's Bargain Outlet is rapidly expanding from a regional chain to a national presence through acquisitions like Big Lots and 99 Cents Only, currently operating about 645 stores with a goal of over 1,000, and reporting a 17% year-over-year revenue increase in the first fiscal quarter, indicating strong market demand.
- Target's New Leadership Hope: New CEO Michael Fiddelke, who took office on February 1, 2023, forecasts a 2% net sales growth for 2026 and plans to restore brand image through store renovations and improved product selection, despite a more than 9% drop in net income for fiscal 2025.
- Dividend Yield and Valuation: Target maintains a 54-year streak of dividend increases, with a current yield of 3.7%, significantly above the S&P 500's 1.2%; if its strategic plan succeeds, it could yield substantial returns for shareholders, with a P/E of 15, lower than Walmart's 47.
See More
Consumer Staples Industry Outlook and Opportunities
- Strategic Optimization Drives Growth: Companies in the consumer staples sector are leveraging strategic optimization initiatives to focus on higher-growth, higher-return categories, particularly in e-commerce and health-focused innovations, thereby enhancing their competitive positioning.
- Stable Demand Supports Industry: Despite shifting consumer spending patterns, the stable demand for essential products ensures resilience in the industry, providing companies with a consistent revenue stream from core offerings.
- Cost Pressures Impact Margins: Rising costs in raw materials, labor, and transportation are squeezing profit margins, prompting many firms to implement restructuring and cost-cutting strategies to improve operational efficiency in response to these challenges.
- Optimistic Industry Outlook: The Zacks Consumer Products industry ranks 74th, placing it in the top 31% of industries, indicating a positive earnings outlook, although the sector has underperformed the broader market in the past six months, it still holds potential for future growth.
See More
Ollie's Bargain Outlet Stock Oversold Signal
- Oversold Indicator: Ollie's Bargain Outlet shares hit an RSI of 29.2 on Monday, indicating an oversold condition that suggests recent heavy selling may be exhausting, prompting investors to consider buying opportunities.
- Price Fluctuation: The stock traded as low as $101.40 per share, with the current price at $101.45, which is close to its 52-week low of $97.04, indicating some price support.
- Market Comparison: Compared to the S&P 500 ETF's RSI of 47.3, Ollie's oversold status may attract investors looking for a rebound, highlighting a divergence in market sentiment.
- Historical Performance: Over the past year, Ollie's shares reached a high of $141.74 per share, and the current price still shows a significant gap from this historical peak, potentially offering investors upside opportunities.
See More
