Burlington Stores: Resilient Performance and Strong Margins Support Buy Rating Amid Market Volatility

In a report released yesterday, Lorraine Hutchinson from Bank of America Securities reiterated a Buy rating on Burlington Stores (BURL – Research Report), with a price target of $350.00.

Lorraine Hutchinson’s rating is based on Burlington Stores maintaining its full-year guidance despite the volatile market conditions, which is reassuring compared to other retailers like Ross Stores that have pulled their outlook. The company is expected to handle potential merchandise margin pressures from tariffs effectively, leveraging the advantages of the off-price retail model, which is more adaptable and resilient than traditional retail. This adaptability positions Burlington Stores to outperform in uncertain environments.
Additionally, Burlington Stores reported a strong first-quarter earnings beat, driven by better-than-expected gross and operating margins. The company’s gross margin improved due to merchandise margin expansion and reduced freight expenses. Despite an increase in inventory, the company has managed to maintain a favorable inventory position, which is promising given concerns about product availability. The reiterated full-year EPS guidance, which now accounts for tariffs, suggests that Burlington Stores is well-positioned to manage external pressures, supporting the Buy rating.

According to TipRanks, Hutchinson is a 5-star analyst with an average return of 7.7% and a 53.94% success rate. Hutchinson covers the Consumer Cyclical sector, focusing on stocks such as Bath & Body Works, Nike, and Ross Stores.

In another report released today, Barclays also maintained a Buy rating on the stock with a $299.00 price target.