Shares of Burlington Stores Inc. ticked up 1.1 percent in midday trading after the company posted fourth-quarter results, boosted by a comparable-store sales gain.
For the three months ended Jan. 31, the company said net income rose 49 percent to $94.9 million, or $1.24 a diluted share, from $63.6 million, or 84 cents, a year ago. Total revenues rose 11.3 percent to $1.5 billion from $1.34 billion, which includes a net sales gain of 11.3 percent to $1.49 billion. The retailer said comps rose 6.7 percent in the quarter, representing its eighth consecutive quarter of positive comps. On an adjusted basis, net income rose 34.5 percent to $108.9 million, or $1.43 a diluted share, from $81 million, or $1.07, a year ago.
For the year, net income spiked to $66 million, or 87 cents a diluted share, from $16.1 million, or 22 cents, with total revenues up 8.7 percent to $4.85 billion from $4.46 billion. On an adjusted basis, net income nearly doubled to $138.6 million, or $1.83 a diluted share, from $70.2 million, or 95 cents, a year ago.
For fiscal year 2015 ending Jan. 30, 2016, the company guided diluted earnings per share on an adjusted basis to between $2.15 to $2.25, on a comps increase of between 2 to 3 percent and a forecasted net sales gain of 6 to 7 percent. For the first quarter ending May 2, the company guided diluted EPS on an adjusted basis of 36 cents to 40 cents, with a comps rise of between 2 to 3 percent and a net sales increased expected in the range of 6 to 7 percent. Diluted EPS for the full year and quarter were slightly below Wall Street’s consensus, which was $2.26 for the year and 41 cents for the quarter.
Tom Kingsbury, chairman, president and chief executive officer, told analysts during a conference call, “From a top-line perspective, we are very pleased to see positive traffic in the quarter, which is a result of our ability to deliver a continuous flow of fresh new trends, categories and highly desirable brands at great values as well as our continued improvement in the store experience.”
In women’s, the business was strong in sportswear, footwear and accessories. Men’s apparel and home also did well during the quarter.
Kingsbury noted the “increase in comps was not only driven by better assortments, but also by continued improvement in the store experience.” He added that at year end, “our comparable store inventories decreased by 18 percent, contributing to a 22 percent faster comparable store inventory turnover.”
The off-pricer’s results for the year and quarter were well enough to have several analysts consider shares of Burlington on their list of stocks to buy.
Matthew R. Boss at J.P. Morgan has shares of Burlington at “overweight,” noting the “upside opportunity across nearly every P&L line setting the stage for continued beat and raise potential.”
Sterne Agee’s Ike Boruchow has a “Buy” rating, noting the company “remains one of the best momentum stories in retail today, with [the fourth quarter] culminating a year in which comps accelerated every quarter and margins expanded meaningfully. The company is firing on all cylinders at the moment, and lean inventory levels down 18 percent per comparable store set the company up well for the new year.”
Wells Fargo’s Paul Lejuez has the shares at “Outperform,” noting “Burlington ‘checks all the boxes’ of a great retail story.…We believe by executing the off-price model better, the company can significantly increase margins in the coming years.”
Shares of Burlington were trading in the $58 range in the mid-afternoon Tuesday on the New York Stock Exchange.