Categories Consumer, Earnings

Earnings preview: What to expect in Burlington Stores Q1 results?

Burlington Stores (BURL) is scheduled to report its earnings results for the first quarter of 2019 on Thursday before the market opens. The results of the off-price branded apparel retailer will be driven by comparable sales and overall sales while the bottom line will hurt by higher costs and expenses. This is despite the company’s disciplined expense management approach.

For several years, the company has been struggling for direction but its refocus on stores, employees and product assortment has remained beneficial. Also, Burlington is expected to continue facing challenges in its heritage ladies apparel business as it is likely to experience merchandise content issues.

The company’s top performing businesses are anticipated to be home, gifts, including toys, beauty, athletic shoes, men’s and ladies sportswear driven by athletic apparel and baby apparel and baby depot. At least 34 former Toys “R” Us sites are part of the company’s 2019 and 2020 new store pipeline, with additional potential opportunity beyond that.

Image Courtesy: Burlington Stores / Facebook post

Analysts expect the company’s earnings to decline by 0.80% to $1.25 per share while revenue will increase by 6.20% to $1.61 billion for the first quarter. In comparison, during the previous year quarter, Burlington reported a profit of $1.26 per share on revenue of $1.52 billion.

The company has surprised investors by beating analysts’ expectations for all of the past four quarters. It is expected that Burlington will post upbeat results for the first quarter of 2019. Majority of the analysts recommended a “strong buy” or “buy” rating while expecting the stock to reach $176.75 per share in the next 52 weeks.

For the fourth quarter, the company posted a 23% drop in earnings due to higher taxes despite a 3% increase in revenue. Strong store traffic more than offset the additional benefit realized in the prior-year quarter due to an extra week. Comparable store sales rose 1.3%, representing a marked slowdown from last year.

Also read: Summer Infant stock falls to 4-year low

During the fourth quarter of 2018, the company opened three new stores, which were the three former Toys “R” Us locations that it opened in November. The final store opening count for 2018 was 68 gross new stores with the seven stores that the company closed at the end of the fourth quarter, its final net new store count was 46 stores.

Burlington expects to open about 75 gross new stores in 2019 and close or relocate about 25 stores, meaning its net new store count for 2019 is expected to be 50 stores, once again, setting a new record for the company for store openings in the fiscal year.

For the first quarter, the company’s management expects adjusted earnings in the range of $1.21 to $1.25 per share, and comparable store sales to grow in the range of 0% to 0.5%. For fiscal 2019, earnings are anticipated to be in the range of $6.93 to $7.06 per share, same-store sales growth is projected to be 1.5% to 2.8%, and sales growth is predicted to be 9% to 10%.

Shares of Burlington opened lower on Tuesday and is trading in the red territory on the NYSE. The stock has risen over 12% in the past year while it has fallen over 8% in the past three months.

Listen to on-demand earnings calls and hear how management responds to analysts’ questions

Most Popular

AVGO Earnings: All you need to know about Broadcom Q1 2021 earnings results

Broadcom Limited (NASDAQ: AVGO) reported first quarter 2021 earnings results today. Total revenue increased 14% year-over-year to $6.65 billion. GAAP net income was $1.3 billion, or $3.05 per share, compared

Infographic: Costco (COST) Q2 2021 sales up 15%; earnings miss

Retail giant Costco Wholesale Corporation (NASDAQ: COST) reported higher earnings and revenues for the second quarter of 2021. Earnings missed analysts’ expectations, while sales beat. Net profit was $951 million

Will shifting to as-a-service model help Hewlett Packard in emerging stronger from COVID?

With the corporate world rapidly shifting to cloud-native computing after the virus outbreak changed work culture and the way businesses operate, technology providers are aggressively innovating their offerings. Hewlett Packard

Add Comment
Loading...
Cancel
Viewing Highlight
Loading...
Highlight
Close
Top