On Monday, TD (TSX:TD) Cowen showed confidence in Boot Barn (NYSE: NYSE:BOOT), adjusting its price target on the company's stock. The firm raised the target to $120 from the previous $115 while maintaining a Buy rating on the shares. This decision comes as Boot Barn has experienced a significant year-to-date increase, with its stock price climbing over 40% and its price-to-earnings (P/E) ratio reaching 21 times.
The analyst at TD Cowen expressed a positive outlook, despite the stock's recent performance potentially setting high expectations for the company's fourth-quarter earnings per share (EPS). The firm believes that there is still room for growth, suggesting that the market may be underestimating Boot Barn's future comparable store sales (comps) for the fiscal year 2025.
In their projections, TD Cowen anticipates that Boot Barn's comps will nearly level off in the second quarter of fiscal year 2025, with a slight decrease of 0.1%. However, they expect a notable rebound in the second half of the year, forecasting a 6.8% increase in comps as the company faces easier comparisons from the previous year.
The analyst's comments highlighted a belief that Boot Barn's valuation remains attractive, considering it as a high-quality EPS compounder. The suggestion is that any potential decline in stock price following the earnings report could present a unique opportunity for investors to buy in.
The positive stance from TD Cowen reflects an expectation that Boot Barn will continue to perform strongly and that the company's stock remains a worthwhile investment despite the higher benchmark set by its recent market performance.
InvestingPro Insights
As investors consider TD Cowen's optimistic price target for Boot Barn (NYSE: BOOT), current InvestingPro data and insights provide a deeper look into the company's financial health and stock performance. The market cap stands at a robust $3.27 billion, with a Price-to-Earnings (P/E) ratio of 19.8, slightly below the ratio mentioned in the article. The company's performance in the last twelve months as of Q3 2024 shows a steady revenue growth of 5.51%, and a noteworthy 3-month price total return of 42.9%, which aligns with the strong year-to-date increase highlighted by TD Cowen.
Two InvestingPro Tips shed light on the stock's current status: Boot Barn's stock price movements are quite volatile, which may appeal to certain investors looking for dynamic trading opportunities, and the company's cash flows can sufficiently cover interest payments, indicating a sound financial structure. Additionally, the stock is trading near its 52-week high, at 98.43% of the peak price, which could signify market confidence in the company's prospects.
For investors seeking further insights, there are additional InvestingPro Tips available that can provide a comprehensive analysis of Boot Barn's financial health and stock potential. Use coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription to access these valuable tips and enhance your investment strategy.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.