BMO maintains Burlington Stores stock Outperform, $277 target

Published 30/05/2025, 15:00
BMO maintains Burlington Stores stock Outperform, $277 target

On Friday, BMO Capital Markets reiterated its Outperform rating for Burlington Stores (NYSE:BURL), maintaining a price target of $277.00. The firm’s analysts highlighted that Burlington’s first-quarter results surpassed expectations on the bottom line, despite a slight shortfall in sales. The company’s performance was bolstered by gross margin of 43.36% and timing of expenses. According to InvestingPro data, the stock is currently trading near its 52-week low of $212.92, suggesting potential value opportunity despite its current Fair Value assessment.

Burlington Stores reported lower than anticipated second-quarter revenue and earnings per share (EPS) forecasts, aligning with the higher end of Wall Street’s predictions. However, the company has maintained its full-year guidance. BMO Capital’s analysts pointed out that management has acknowledged an increasingly uncertain environment since March. They noted concerns over tariffs impacting merchandise margins, but also expressed confidence that these pressures could be mitigated through other areas of the profit and loss statement (P&L).

The analysts are looking forward to the company’s conference call for more detailed information, especially any new or updated insights on the impact of tariffs. Burlington’s management has affirmed their belief in the company’s long-term business model, despite the current challenges. With a market capitalization of $14.41 billion and an overall Financial Health Score of FAIR from InvestingPro, the company maintains a solid foundation for navigating market uncertainties.

Burlington Stores’ ability to exceed profit expectations in the first quarter, despite a sales miss, reflects management’s adept handling of expenses and margins. The company’s cautious outlook for the second quarter, while still in line with analyst estimates, suggests a prudent approach in a volatile market environment.

The BMO Capital team’s continued support for Burlington Stores is based on the company’s solid performance and strategic management, which is expected to help navigate through the uncertain landscape marked by tariff concerns. The reaffirmed $277.00 price target indicates the firm’s confidence in Burlington Stores’ prospects and its ability to offset potential tariff-related setbacks.

In other recent news, Burlington Stores reported first-quarter earnings per share (EPS) of $1.67, exceeding the consensus estimate of $1.44, according to Evercore ISI and JPMorgan. Despite flat same-store sales, the company achieved a 30 basis point improvement in operating margin, reaching 6.0%, as noted by JPMorgan. Burlington Stores has maintained its fiscal year 2025 EPS guidance, ranging from $8.70 to $9.30, and anticipates flat to 2% growth in same-store sales. Telsey Advisory Group remarked on Burlington’s acquisition of 46 leases from Joann’s, highlighting it as a strategic move to expand its retail footprint.

Analysts from Bernstein, Telsey, Morgan Stanley (NYSE:MS), Evercore ISI, and JPMorgan all adjusted their price targets for Burlington Stores, with figures ranging from $267 to $365, while maintaining positive ratings. Morgan Stanley and Bernstein both expressed optimism about Burlington’s long-term growth potential, though they noted some short-term challenges. Burlington’s management has acknowledged the uncertain consumer outlook and the impact of tariffs, which remain a focus for the company. The company’s strategy includes increasing Packaway inventory and capitalizing on purchasing opportunities, as emphasized by Bernstein. Despite these challenges, Burlington Stores continues to navigate the retail environment with a focus on sustaining its financial targets.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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