NEW YORK (TheStreet) -- Burlington Stores (BURL) shares are up 2.9% to $45.10 on Thursday after the clothing retailer announced the secondary offering of 8 million shares of common stock.
The shares will be sold by affiliates of Bain Capital and certain other shareholders. JPMorgan will act as the sole book-running manager for the offering. Burlington will not sell any shares in the offering and will not receive any proceeds.
Burlington is trading on extremely heavy volume today with 2.1 million shares being traded so far, more than three times the stock's three month daily average of 684,000 shares.
Must Read: Warren Buffett's 25 Favorite Stocks
TheStreet Ratings team rates BURLINGTON STORES INC as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:
"We rate BURLINGTON STORES INC (BURL) a SELL. This is driven by several weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. Among the areas we feel are negative, one of the most important has been unimpressive growth in net income over time."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Multiline Retail industry. The net income has significantly decreased by 103.0% when compared to the same quarter one year ago, falling from -$16.86 million to -$34.21 million.
- BURLINGTON STORES INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This year, the market expects an improvement in earnings ($1.63 versus $0.61).
- 40.09% is the gross profit margin for BURLINGTON STORES INC which we consider to be strong. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of -2.93% trails the industry average.
- Net operating cash flow has improved to $36.93 million from having none in the same quarter last year. Since the company had no net operating cash flow for the prior period, we cannot calculate a percent change in order to compare its growth rate with that of its industry average.
- The revenue growth came in higher than the industry average of 3.6%. Since the same quarter one year prior, revenues slightly increased by 8.7%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- You can view the full analysis from the report here: BURL Ratings Report