On Tuesday, Jefferies, a global investment banking firm, increased its price target for Ollie's Bargain Outlet (NASDAQ: OLLI), a leading discount retailer. The new price target is set at $125, up from the previous figure of $110, while the firm retains a Buy rating on the stock. The stock is currently trading at $111.57, surpassing its previous 52-week high of $104.98.
The positive sentiment from Jefferies is rooted in Ollie's Bargain Outlet's dominant position in the growing closeout retail sector. According to the firm, Ollie's has demonstrated strong operational performance with 14.15% revenue growth and benefits from a consistent supply of merchandise, contributing to the company's stable fundamentals and forecast reliability. The company maintains a perfect Piotroski Score of 9, according to InvestingPro data, indicating exceptional financial strength.
Jefferies also noted that Ollie's has abundant real estate opportunities, with an increasing number of store openings. This expansion is seen as a significant growth driver, as Ollie's currently operates in only 31 states, indicating substantial room for market penetration.
The investment bank underlines Ollie's status as a top-tier player within its market segment. Jefferies believes that the company's solid track record and expansion potential justify a premium valuation, leading to the adjusted price target of $125. This endorsement reflects confidence in Ollie's ongoing strategy and future performance in the retail industry.
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