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On Tuesday, UBS analysts maintained a Buy rating on Burlington Stores (NYSE:BURL) with a steady price target of $390.00, representing a 61% upside from the current price of $242.17. The firm’s analysts highlighted that their industry checks indicate a strong first quarter for the retailer. They anticipate Burlington Stores to report earnings per share (EPS) that slightly exceed consensus estimates by 2 cents. InvestingPro data shows that 5 analysts have recently revised their earnings estimates upward, with the stock maintaining a highly bullish consensus rating of 1.38.
The analysts pointed out that the market is particularly focused on three critical questions regarding Burlington Stores: the company’s first-quarter same-store sales growth rate, whether it will update or withdraw its fiscal year 2025 guidance, and the potential impact of macroeconomic factors and tariffs on its guidance if it is maintained. UBS analysts acknowledged the uncertainty around how Burlington Stores will respond to these questions, suggesting a balanced risk/reward scenario leading up to the earnings report, which InvestingPro indicates is scheduled for May 29, just two days away.
According to UBS, market expectations are set for a zero percent growth rate in same-store sales for the first quarter of 2025, an update to the fiscal year 2025 guidance, and a reduction in the EPS outlook for fiscal year 2025 by 40 to 60 cents due to the impact of tariffs. The options market is anticipating a significant reaction to the upcoming earnings report, with an expected price movement of plus or minus 8.2%, compared to the historical average move of 7.2%.
The wide range of potential outcomes suggests investors are bracing for volatility in Burlington Stores’ stock price following the release of the first-quarter earnings. The firm’s analysis indicates that while there is potential for upside, there is also a considerable degree of uncertainty that could influence the stock’s performance in the near term.
In other recent news, UBS has raised the price target for Burlington Stores to $405, while maintaining a Buy rating. This decision follows a strong quarterly performance by the retailer, with UBS forecasting a 19% compound annual growth rate in earnings per share over the next five years. Bernstein also increased its price target for Burlington Stores to $380, citing the company’s progress in its multi-year turnaround and its ability to close the gap with competitors. Meanwhile, TD Cowen has reaffirmed its Buy rating on Burlington Stores, setting a price target of $335 and highlighting the company’s strategy to expand its store base and improve efficiency. UBS analyst Jay Sole expressed confidence in Burlington’s resilience against economic challenges, suggesting that the retailer is well-positioned to weather potential downturns. The firm’s Burlington 2.0 strategy, which includes significant store expansion and operational improvements, is expected to drive growth. Analysts project Burlington’s earnings per share to grow significantly, with UBS’s FY25 EPS estimate standing at $10.30, 8% above consensus. These developments indicate that Burlington Stores is receiving strong support from analysts, with multiple firms projecting robust future growth.
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