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On Tuesday, RBC Capital analysts reaffirmed their Outperform rating for Ollie’s Bargain Outlet stock (NASDAQ: OLLI) and upheld a price target of $133. This decision follows the company’s first-quarter results, which met market expectations and continue to fuel discussions among investors regarding its future performance. The company, currently valued at $6.75 billion, trades at a P/E ratio of 34.09, reflecting high growth expectations. According to InvestingPro data, four analysts have recently revised their earnings estimates upward for the upcoming period.
The analysts highlighted that while bullish investors are optimistic about the positive impact from Big Lots (NYSE:BIG) closures and strong gross margins, skeptics remain cautious about discrepancies between reported and underlying comparable sales figures. The weather challenges are expected to ease, and the analysts believe the second quarter will be crucial in determining the viability of the bullish outlook. With revenue growth of 8.7% in the last twelve months and analyst targets ranging from $105 to $137, InvestingPro analysis suggests the stock is slightly overvalued at current levels.
RBC Capital’s model for Ollie’s remains largely unchanged. However, they have slightly increased their third-quarter comparable sales estimate to 1.5% from the previous 1.0%, attributing this adjustment to strong underlying trends, excluding weather-related impacts. Despite this adjustment, the adjusted earnings per share (EPS) estimate for the third quarter remains at $0.95 due to anticipated higher medical and casualty claim expenses.
Looking ahead to 2025 and 2026, the analysts have adjusted their model to project comparable sales growth of 3.6% and 2.0%, respectively, while maintaining their adjusted EPS estimates at $3.90 and $4.43. The price target of $133 is based on approximately 30 times the 2026 adjusted EPS estimate of $4.43.
Overall, RBC Capital’s analysis indicates a steady outlook for Ollie’s Bargain Outlet, with an emphasis on the significance of the upcoming quarter in shaping investor sentiment. InvestingPro’s comprehensive analysis shows the company maintains a "GOOD" financial health score, with liquid assets exceeding short-term obligations. Discover more insights and 8 additional ProTips about OLLI in the full Pro Research Report.
In other recent news, Ollie’s Bargain Outlet reported stronger-than-expected first-quarter results for 2025, with earnings per share (EPS) of $0.75, surpassing analyst expectations of $0.71. The company’s revenue also exceeded forecasts, reaching $576.8 million compared to the anticipated $565.9 million. Truist Securities raised their price target for Ollie’s Bargain Outlet stock to $128 from $126, maintaining a Buy rating, reflecting confidence in the company’s strategic positioning and future performance. Citi analysts also reiterated a Buy rating, maintaining their price target at $133, following the company’s solid first-quarter performance and significant same-store sales growth.
Ollie’s has slightly raised its full-year comparable sales guidance and maintained its earnings outlook despite facing additional costs related to tariffs and store growth acceleration. The company opened a record 25 new stores in the first quarter, contributing to a 13% increase in net sales. Analysts from both Citi and Truist Securities expressed optimism about Ollie’s potential for increased consumer demand and market share growth, especially with the closure of Big Lots stores. The company’s inventory levels are favorable amidst tariff disruptions, positioning Ollie’s as a disruptive force in retail growth.
Ollie’s reaffirmed its full-year guidance, projecting net sales between $2.579 billion and $2.599 billion, and plans to open 75 new stores this year. The company continues to navigate market challenges while maintaining strong growth potential, as outlined by analysts, who see Ollie’s as a leading growth stock in the small-cap retail sector.
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