Shares of discount retail chain operator Ollie’s Bargain Outlet Holdings, Inc. (OLLI) plummeted more than 14% in Thursday’s extended trade to close at $66.56 as the company reported weaker-than-expected results for the second quarter ended July 31, 2021.
Ollie’s Bargain Outlet reported quarterly net sales of $415.9 million, down 21.4% from $529.3 million a year ago. The figure also failed to surpass the Street’s estimates of $435.75 million. The strong de-growth in sales can be attributed primarily to a 28% decline witnessed in comparable store sales.
The company reported quarterly earnings per share (EPS) of $0.52, down 65.3% from the previous year. Moreover, it missed analysts’ estimates of $0.55.
In other key operating metrics, the company opened 12 new stores in the quarter, taking the total number of stores to 409 across 28 states in the U.S. Average net sales per store stood at $1.02 million, compared to $1.45 million a year ago.
The CEO of Ollie’s Bargain Outlet, John Swygert, said, “We are very pleased with our results for the second quarter as we delivered comparable store sales growth of 15.3% on a two-year stack basis, well ahead of our long-term growth algorithm, and adjusted EBITDA growth of 44% as compared to 2019.” (See Ollie’s Bargain Outlet stock chart on TipRanks)
On August 26, Berenberg Bank analyst Brian McNamara reiterated a Hold rating on the stock with a price target of $98. The analyst’s price target implies upside potential of 26.1% from current levels.
The Wall Street community is cautiously optimistic about the stock with a Moderate Buy consensus rating based on 4 Buys, 1 Hold and 1 Sell. The average Ollie’s Bargain Outlet price target of $105 implies that the stock has upside potential of 35.1% from current levels. Shares have declined about 27.3% over the past year.
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