RBC Capital sets a price target of $130 for NASDAQ:OLLI, indicating a potential upside of 17.1%.
Ollie’s reports a 7.8% increase in quarterly sales to $517 million, driven by new store openings.
The company’s stock price has risen to $113.51, marking a 2.24% increase and reaching its highest price over the past year.
Ollie’s Bargain Outlet Holdings, Inc. (NASDAQ:OLLI) is a retail company known for offering discounted merchandise. It operates a chain of stores that sell a variety of products, including housewares, food, books, and toys. The company competes with other discount retailers like Big Lots and Dollar General. Recently, RBC Capital’s Steven Shemesh set a price target of $130 for OLLI, suggesting a potential upside of 17.1% from its current price of $111.02.
Ollie’s has received a buy rating upgrade due to its strong growth prospects. The market is willing to assign a premium multiple to its stock, as highlighted by the company’s recent financial performance. In its third-quarter results, Ollie’s reported adjusted earnings per share of 58 cents, surpassing the expected 57 cents. Quarterly sales reached $517 million, marking a 7.8% increase, driven by new store openings.
Despite facing temporary challenges, Ollie’s fundamentals remain robust. The company is expanding through new store openings and potential real estate acquisitions from Big Lots. However, investors should be cautious of the high valuation risk. Any earnings miss could lead to a significant decline in the share price, as the market has high expectations for Ollie’s performance.
RBC Capital’s Steven Shemesh reiterated an Outperform rating for OLLI, raising the price target from $120 to $130. He noted that the impact of liquidation was less severe than anticipated, and the guidance for the fourth quarter suggests strong underlying sales trends. A 10% unit growth in 2025 appears more achievable, which could help mitigate some risks and indicate potential market share gains.
Currently, OLLI’s stock is priced at $113.51, reflecting an increase of approximately 2.24%. The stock has risen by $2.49 today, with a trading range from $112.35 to $115.98, marking its highest price over the past year. OLLI has a market capitalization of approximately $6.96 billion, with a trading volume of 1,793,181 shares.
