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On Wednesday, Truist Securities expressed a positive outlook on Ollie’s Bargain Outlet Holdings Inc (NASDAQ:OLLI), as analyst Scot Ciccarelli increased the firm’s price target on the discount retailer’s stock to $126 from the previous $121, while reiterating a Buy rating. The stock, currently trading at $109.16 with a market capitalization of $6.7 billion, has shown strong momentum with a 31.5% return over the past year. According to InvestingPro data, analyst targets for the stock range from $105 to $133.
Ciccarelli cited a robust fourth quarter for the company, acknowledging that Ollie’s overcame challenges such as competitive store closures—which are now diminishing—and unfavorable weather conditions that affected much of the retail sector. The analyst highlighted that these headwinds did not deter Ollie’s performance. The company’s financial health remains strong, with InvestingPro data showing impressive revenue growth of 12.5% and a healthy current ratio of 2.91, indicating solid liquidity management.
Looking ahead, the analyst anticipates that Ollie’s unit growth for fiscal years 2025 and 2026 should surpass the algorithmic expectations of low-teen estimates, historically around 10%. Ciccarelli suggests that the company’s guidance for 2025 might be modest, considering Ollie’s strong positioning to accelerate market share gains by capturing orphaned sales and appealing to consumers seeking deep value amidst economic pressure.
Additionally, Ciccarelli pointed out that potential tariff-related order cancellations could present Ollie’s with further inventory buying opportunities. This aspect, combined with the company’s current trajectory, underpins Truist Securities’ conviction in maintaining a Buy rating for Ollie’s stock.
In conclusion, Truist Securities remains bullish on Ollie’s prospects, emphasizing that the company possesses one of the most favorable near to mid-term setups within their coverage universe. The revised price target of $126 up from $121 reflects this sentiment.
In other recent news, Ollie’s Bargain Outlet Holdings, Inc. reported its fourth-quarter 2025 earnings, meeting analyst expectations with an adjusted earnings per share (EPS) of $1.19. Despite a slight revenue miss, the company achieved a 3% year-over-year increase in net sales to $667 million. Ollie’s plans to open 75 new stores in 2025, aiming for a 10% annual unit growth, which reflects its strategic expansion efforts. The company’s acquisition of store leases from Big Lots (NYSE:BIG) is expected to contribute to its growth, alongside the launch of a private label credit card.
Analysts from firms like Citi and Piper Sandler have shown interest in Ollie’s growth prospects, particularly regarding the impact of the Big Lots store closures. The company’s financial position remains strong, with cash and short-term investments totaling $429 million at the end of the quarter. Ollie’s has also announced a new $300 million share buyback program, indicating a commitment to returning capital to investors. The company maintains a gross margin target of approximately 40%, with an adjusted EPS forecast of $3.65 to $3.75 for fiscal year 2025.
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