BJ’s Wholesale stock rating reiterated at Buy by UBS ahead of Q2 results

Investing.com - UBS has reiterated its Buy rating and $135.00 price target on BJ’s Wholesale (NYSE:BJ) ahead of the company’s second-quarter earnings report, due in 9 days. According to InvestingPro data, analyst targets range from $70 to $140, with the stock currently trading at $101.49.

The investment firm expects BJ’s to show continued demand for its membership offering in the second quarter, even as comparable sales growth may soften sequentially due to more challenging year-over-year comparisons.

UBS believes BJ’s consumables business likely led performance once again, with the company benefiting from investments in its Fresh 2.0 initiative and market share gains following Stop & Shop’s late 2024 store closures.

The firm notes that big-ticket items are not expected to be a significant growth driver in the quarter, as BJ’s core consumers likely remained financially constrained and more focused on everyday necessities.

BJ’s Wholesale operates membership warehouse clubs primarily in the eastern United States, competing with retailers like Costco and Sam’s Club in the wholesale club segment.

In other recent news, BJ’s Wholesale Club Holdings Inc reported its first-quarter fiscal year 2025 earnings, delivering adjusted earnings per share (EPS) of $1.14, which exceeded the forecast of $0.91. However, the company did not meet revenue expectations, reporting $5.03 billion compared to a forecast of $5.19 billion. DA Davidson raised the price target for BJ’s Wholesale to $140, up from $130, while maintaining a Buy rating. The analyst from DA Davidson highlighted the company’s strong performance in the first quarter and the success of its strategic initiatives, particularly in comparable store sales growth. The Fresh 2.0 initiative, which enhances produce selection, is expected to contribute further to this growth. Goldman Sachs also reiterated its Buy rating on BJ’s Wholesale, setting a price target of $130. The firm noted expectations for earnings upside driven by strong traffic trends and unit volume growth in grocery categories. Additionally, BJ’s has seen increased customer engagement in general merchandise categories due to assortment refresh efforts.

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