NEW YORK (TheStreet) -- The Buckle, Inc. (BKE - Get Report) shares had coverage initiated with a "fairly valued" rating and a price target of $49 by analysts at CRT Capital on Wednesday.
The firm's price target on the casual apparel retailer's shares suggests a 1.24% increase from the company's closing price yesterday and believes that the company's current valuation is accurate.
TheStreet Ratings team rates BUCKLE INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate BUCKLE INC (BKE) a BUY. This is driven by several positive factors, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, expanding profit margins and notable return on equity. We feel these strengths outweigh the fact that the company shows weak operating cash flow."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- BKE has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. To add to this, BKE has a quick ratio of 1.53, which demonstrates the ability of the company to cover short-term liquidity needs.
- The gross profit margin for BUCKLE INC is rather high; currently it is at 50.17%. Regardless of BKE's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, BKE's net profit margin of 17.49% significantly outperformed against the industry.
- BUCKLE INC' earnings per share from the most recent quarter came in slightly below the year earlier quarter. The company has suffered a declining pattern of earnings per share over the past year. However, we anticipate this trend reversing over the coming year. During the past fiscal year, BUCKLE INC reported lower earnings of $3.38 versus $3.44 in the prior year. This year, the market expects an improvement in earnings ($3.46 versus $3.38).
- BKE, with its decline in revenue, slightly underperformed the industry average of 5.3%. Since the same quarter one year prior, revenues slightly dropped by 6.0%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
- Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Specialty Retail industry and the overall market, BUCKLE INC's return on equity significantly exceeds that of both the industry average and the S&P 500.
- You can view the full analysis from the report here: BKE Ratings Report