Burlington Stores (BURL) Stock Price Target Lowered at BMO Capital

NEW YORK (TheStreet) -- Burlington Stores (BURL) had its price target lowered to $59 from $65 at BMO Capital with an "outperform" rating.

Burlington Stores announced its first quarter earnings results with revenue of $1.19 billion, or $0.41 earnings per share yesterday.

The disappointment was on the 0.8% same-store sales increase versus expectations for a 4.1% growth, BMO Capital noted.

"We believe the pressure came from what we view as more one-time in nature headwinds including west coast port delays and a significant year-over-year increase in the first quarter store closure days, given unfavorable weather, " analysts at BMO Capital added.

Burlington Stores is a retailer of branded apparel that owns 542 stores, inclusive of an Internet store, in 44 states of the U.S. and Puerto Rico.

Shares of Burlington Stores are down 0.12% to $49.29 in trading afternoon Wednesday.

Separately, 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 some concerns, 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. The area that we feel has been the company's primary weakness has been its weak operating cash flow."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • This stock has increased by 94.35% over the past year, outperforming the rise in the S&P 500 Index during the same period. Setting our sights on the months ahead, however, we feel that the stock's sharp appreciation over the last year has driven it to a price level which is now relatively expensive compared to the rest of its industry. The implication is that its reduced upside potential is not good enough to warrant further investment at this time.
  • Net operating cash flow has slightly increased to $213.83 million or 3.76% when compared to the same quarter last year. Despite an increase in cash flow of 3.76%, BURLINGTON STORES INC is still growing at a significantly lower rate than the industry average of 117.59%.
  • 42.62% 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. Along with this, the net profit margin of 6.33% is above that of the industry average.
  • BURLINGTON STORES INC has improved earnings per share by 47.6% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, BURLINGTON STORES INC increased its bottom line by earning $0.85 versus $0.61 in the prior year. This year, the market expects an improvement in earnings ($2.28 versus $0.85).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Multiline Retail industry. The net income increased by 49.2% when compared to the same quarter one year prior, rising from $63.58 million to $94.87 million.
  • You can view the full analysis from the report here: BURL Ratings Report

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