On Wednesday, Craig-Hallum maintained a positive outlook on Ollie's Bargain Outlet (NASDAQ:OLLI) Holdings Inc. (NASDAQ:OLLI), raising its price target to $130 from the previous $107 while sustaining a Buy rating on the stock. The stock, currently trading at $111.02, has shown remarkable momentum with a 46% gain year-to-date and is approaching its 52-week high of $113.76.
This adjustment follows Ollie's release of third-quarter results, which presented a complex picture of slight underperformance in sales and same-store sales (SSS), but an exceedance in earnings per share (EPS) expectations. According to InvestingPro analysis, the company maintains a strong financial health score, reflecting its solid market position.
The company's Q3 financials revealed that despite the modest shortfall in sales figures, Ollie's managed to surpass EPS estimates, achieving $3.36 in diluted EPS over the last twelve months. The unchanged guidance for Q4 indicates that the company's performance is expected to remain steady, with analysts forecasting EPS of $3.73 for fiscal year 2025.
Market analysts had set low expectations for the company's comparable store sales trends before the earnings report, but the confirmation of consistent Q4 targets has been met with a positive reception. InvestingPro subscribers can access 14 additional key insights about Ollie's performance and valuation metrics.
The investment firm highlighted the growth potential for Ollie's, noting the abundance of real estate opportunities and the management's proactive approach in acquiring leases from bankrupt retailers. As numerous large-scale retailers are downsizing and closing stores, Ollie's is capitalizing on its scale and liquidity to enhance supplier relationships and improve deal flow.
Craig-Hallum's analysis suggests that Ollie's is well-positioned to be the preferred buyer in the closeout market, which continues to expand despite a reduction in competition. The firm's confidence in Ollie's strategic advantages and market opportunities has led to the increased price target, reinforcing the Buy rating for the stock.
In other recent news, Ollie's Bargain Outlet has seen a flurry of positive analyst activity.
RBC (TSX:RY) Capital Markets has adjusted their price target for Ollie's stock to $130 from a previous $120, maintaining an Outperform rating. This adjustment comes after a review of the company's third-quarter performance and forward-looking projections, with the fourth-quarter comparable sales forecast revised to a 3.0% increase and the earnings per share (EPS) estimate adjusted to $1.22 from $1.17.
Meanwhile, Loop Capital has increased the price target for Ollie's shares to $120 from the previous $110, reiterating a Buy rating. The firm's decision reflects a positive outlook on the retailer's recent performance and the potential for market share gains.
Piper Sandler has also raised Ollie's price target to $126 from $107, with the anticipation of several years of 20%+ earnings per share (EPS) growth. The company's strategic expansion and industry dynamics are expected to positively influence its financial performance in the coming years.
In addition, JPMorgan (NYSE:JPM) updated its outlook on Ollie's, raising the price target to $135 from the previous $105 while maintaining an Overweight rating, due to Ollie's strong unit growth and expectations for further expansion. Lastly, Jefferies increased its price target for Ollie's to $125, up from the previous figure of $110, maintaining a Buy rating on the stock.
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