Bj's Wholesale Club Holdings (BJ) AI Stock Analysis

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Bj's Wholesale Club Holdings

(NYSE:BJ)

Rating:77Outperform

Price Target:

$126.00

▲(13.90%Upside)

BJ's Wholesale Club Holdings scores a 77, driven primarily by strong financial performance and positive earnings call outcomes. The company's robust growth in revenue, membership, and digital sales, alongside strategic expansion plans, are significant strengths. Technical indicators suggest potential short-term weakness, but valuation remains reasonable, supporting a positive long-term outlook despite macroeconomic challenges.

Positive Factors

Digital Expansion

Digital conveniences like BOPIC, ExpressPay, Curbside Pick-Up, and Same-Day Delivery drive deeper share gains across income and age cohorts.

Membership Growth

Higher tier membership penetration above 40% and 90% tenured renewal rates validate the success of BJ's efforts to improve membership lifetime value.

Negative Factors

Consumer Sentiment

General merchandise was a weaker performance area for the Q, partially due to consumer sentiment being choosy around big-ticket discretionary items.

Valuation Concerns

The valuation appears stretched, representing the high end of GARP staples retailers.

Bj's Wholesale Club Holdings (BJ) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$14.61B

Dividend YieldN/A

Average Volume (3M)1.80M

Price to Earnings (P/E)25.7

Beta (1Y)0.04

Revenue Growth2.84%

EPS Growth11.25%

CountryUS

Employees33,000

SectorConsumer Defensive

Sector Strength66

IndustryDiscount Stores

Share Statistics

EPS (TTM)1.14

Shares Outstanding132,050,700

10 Day Avg. Volume1,540,470

30 Day Avg. Volume1,795,408

Financial Highlights & Ratios

PEG Ratio0.84

Price to Book (P/B)8.92

Price to Sales (P/S)0.00

P/FCF Ratio22.37

Enterprise Value/Market Cap0.85

Enterprise Value/Revenue0.15

Enterprise Value/Gross Profit3.22

Enterprise Value/Ebitda2.99

Forecast

1Y Price Target

$126.14

Price Target Upside14.03% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering16

Bj's Wholesale Club Holdings Business Overview & Revenue Model

Company DescriptionBJ's Wholesale Club Holdings, Inc., together with its subsidiaries, operates warehouse clubs on the east coast of the United States. It provides perishable, general merchandise, gasoline, and other ancillary services. The company sells its products through the websites BJs.com, BerkleyJensen.com, Wellsleyfarms.com, and Delivery.bjs.com as well as the mobile app. As of June 10, 2022, it operated 229 warehouse clubs and 160 gas locations in 17 states. The company was formerly known as Beacon Holding Inc. and changed its name to BJ's Wholesale Club Holdings, Inc. in February 2018. BJ's Wholesale Club Holdings, Inc. was founded in 1984 and is headquartered in Westborough, Massachusetts.

How the Company Makes MoneyBJ's Wholesale Club makes money primarily through membership fees and the sale of goods in bulk quantities to its members. Membership fees provide a steady and recurring revenue stream, as customers pay annually for access to the warehouse club's discounts and services. Additionally, BJ's generates revenue from the sale of a wide range of products, including groceries, electronics, home goods, and more, often at lower prices than traditional retail stores due to their bulk purchasing model. The company also benefits from partnerships with various suppliers and manufacturers, allowing them to offer exclusive deals and private label products. Supplemental revenue is generated through services such as optical and tire centers, as well as fuel sales at certain locations. Overall, BJ's combines its membership model with strategic sourcing and product offerings to drive its revenue.

Bj's Wholesale Club Holdings Key Performance Indicators (KPIs)

Any

Store Count

Store Count
Counts the number of operational stores, indicating the company's physical presence and expansion strategy, which can impact market reach and sales potential.

Chart InsightsBJ's Wholesale Club Holdings has consistently expanded its store count, reaching 252 by early 2024. This growth aligns with strategic plans to open 25 to 30 new clubs over the next two years, supported by robust membership growth and strong digital sales. The company's expansion into new markets, such as Dallas-Fort Worth, is expected to drive further growth despite challenges like declining merchandise margins and tariff risks. The focus on perishables and digital sales positions BJ's well for sustained performance and market penetration.

Data provided by:

Main Street Data

Bj's Wholesale Club Holdings Earnings Call Summary

Earnings Call Date:May 22, 2025

(Q1-2025)

% Change Since: -5.86%|

Next Earnings Date:Aug 14, 2025

Earnings Call Sentiment Positive

BJ's Wholesale Club Holdings, Inc. reported strong financial results for the first quarter of fiscal 2025. The company demonstrated significant growth in membership and digital sales, and strong performance from the Fresh 2.0 initiative. However, there were challenges in the general merchandise segment and concerns about macroeconomic uncertainties and potential margin pressures. Despite these challenges, the overall performance and strategic initiatives suggest a positive outlook.

Q1-2025 Updates

Positive Updates

Strong Financial Performance

BJ's reported a strong start to fiscal 2025 with first quarter net sales growing by 4.7%, and operating income and net income increasing by 27% and 35% respectively.

Membership Growth and Engagement

Higher tier membership penetration grew by over 100 basis points sequentially, surpassing 40% for the first time in company history. Membership fee income grew by 8.1% to approximately $120.4 million.

Digital Sales Surge

Digitally enabled comp sales grew by 35% year over year in the first quarter, contributing significantly to overall sales growth.

Fresh 2.0 Initiative Success

The Fresh 2.0 initiative in produce resulted in high single digit to low double digit growth. The initiative is now being expanded to meat and seafood.

Real Estate Expansion

BJ's opened five new clubs in the first quarter and plans to open 25 to 30 new clubs over the next two years.

Negative Updates

General Merchandise and Services Division Softness

Comps in the general merchandise and services division decreased slightly in the first quarter, with unfavorable weather and consumer sentiment impacting discretionary categories.

Macroeconomic Uncertainty

The company acknowledges operating in uncertain times with potential impacts on financial performance due to economic conditions and tariffs.

Margin Pressure Concerns

Continued investments and cost pressures, including those related to Fresh 2.0 and tariff uncertainties, could impact margins throughout the year.

Company Guidance

In the fiscal 2025 first quarter earnings call, BJ's Wholesale Club Holdings, Inc. reported a strong performance, surpassing expectations with a 4.7% increase in net sales to $5 billion. Operating income and net income grew by 27% and 35%, respectively. The company achieved a 3.9% increase in comparable club sales excluding gas sales, driven by a 2.5-point contribution from traffic growth, marking the thirteenth consecutive quarter of traffic increases. Membership fee income rose 8.1% to approximately $120.4 million, with higher tier membership penetration surpassing 40% for the first time. Digital convenience sales surged 35% year over year, contributing significantly to overall sales growth. BJ's maintained its full-year guidance of 2% to 3.5% comp sales growth excluding gas and adjusted earnings per share of $4.10 to $4.30, despite a more uncertain economic environment. The company is on track to open 25 to 30 new clubs over the next two years, supported by strong membership growth and strategic investments in digital conveniences and Fresh 2.0 initiatives.

Bj's Wholesale Club Holdings Financial Statement Overview

Summary

BJ's Wholesale Club Holdings demonstrates strong financial performance with consistent revenue growth, stable profitability, and effective cash flow management. While the company shows robust return on equity and improved debt-to-equity ratio, the high portion of assets financed through liabilities poses a risk.

Income Statement

Very Positive

The income statement of BJ's Wholesale Club Holdings shows strong performance with a consistent increase in total revenue over the years, growing from $15.4 billion in 2021 to $20.7 billion TTM in 2025. Gross profit margins have remained stable, and the net profit margin has improved, indicating efficient cost management. Revenue growth rate has been positive year-over-year, reflecting effective market penetration and expansion strategies. EBIT and EBITDA margins are healthy, supporting the company's profitability.

Balance Sheet

Positive

The balance sheet indicates a moderate level of financial health. The debt-to-equity ratio has improved over the years, showing a decrease in leverage risk. Return on equity has been robust, reflecting efficient use of shareholder funds. However, the equity ratio suggests that a significant portion of the company's assets is financed through liabilities, which may pose a risk in periods of economic downturn.

Cash Flow

Positive

Cash flow analysis reveals a strong operational cash flow, consistently exceeding net income, indicating effective cash management. Free cash flow has shown growth, albeit with fluctuations due to capital expenditures. The operating cash flow to net income ratio is solid, demonstrating the firm's ability to convert profits into cash. Despite some volatility in free cash flow, the overall cash generation capability remains strong.

TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Breakdown
Income Statement		Total Revenue
20.74B	20.50B	19.97B	19.32B	16.67B	15.43B
	Gross Profit
3.85B	3.76B	3.64B	3.43B	3.08B	2.98B
	EBIT
815.10M	772.21M	800.42M	737.99M	617.32M	642.39M
	EBITDA
1.01B	1.03B	1.03B	951.24M	815.37M	809.85M
	Net Income Common Stockholders
573.17M	534.42M	523.74M	513.18M	426.65M	421.03M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
39.48M	28.27M	36.05M	33.91M	45.44M	43.52M
	Total Assets
7.16B	7.07B	6.68B	6.35B	5.70B	5.41B
	Total Debt
2.70B	2.84B	2.99B	3.09B	2.98B	3.23B
	Net Debt
2.66B	2.82B	2.96B	3.05B	2.93B	3.18B
	Total Liabilities
5.19B	5.22B	5.22B	5.30B	5.05B	5.09B
	Stockholders Equity
1.97B	1.85B	1.46B	1.05B	648.11M	319.33M
Cash Flow		Free Cash Flow
285.38M	312.89M	251.81M	417.63M	527.14M	650.21M
	Operating Cash Flow
908.12M	900.87M	718.88M	788.16M	831.65M	868.55M
	Investing Cash Flow
-626.12M	-589.57M	-454.76M	-747.06M	-304.51M	-192.44M
	Financing Cash Flow
-277.61M	-319.08M	-261.98M	-52.63M	-525.23M	-662.79M

Bj's Wholesale Club Holdings Technical Analysis

Technical Analysis Sentiment

Positive

Last Price110.62

Price Trends

50DMA

114.36

Negative

100DMA

110.11

Positive

200DMA

99.20

Positive

Market Momentum

MACD

-1.35

Positive

RSI

45.55

Neutral

STOCH

31.73

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BJ, the sentiment is Positive. The current price of 110.62 is below the 20-day moving average (MA) of 112.91, below the 50-day MA of 114.36, and above the 200-day MA of 99.20, indicating a neutral trend. The MACD of -1.35 indicates Positive momentum. The RSI at 45.55 is Neutral, neither overbought nor oversold. The STOCH value of 31.73 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for BJ.

Bj's Wholesale Club Holdings Risk Analysis

Bj's Wholesale Club Holdings disclosed 51 risk factors in its most recent earnings report. Bj's Wholesale Club Holdings reported the most risks in the "Finance & Corporate" category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Bj's Wholesale Club Holdings Peers Comparison

Overall Rating

UnderperformOutperform

Sector (65)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
COST	78 Outperform	$439.14B	56.17	32.08%	0.53%	5.94%	9.31%
WMT	78 Outperform	$753.67B	40.51	22.80%	1.00%	4.22%	-0.17%
BJ	77 Outperform	$14.61B	25.72	32.76%	―	2.84%	11.25%
KR	69 Neutral	$43.65B	17.85	26.59%	1.95%	-1.94%	23.94%
TGT	66 Neutral	$43.33B	10.48	29.08%	4.70%	-0.69%	2.03%
Sector *	65 Neutral	$8.82B	14.91	4.71%	6.22%	3.60%	-2.66%
DLTR	58 Neutral	$19.87B	―	19.25%	―	-20.46%	-202.26%

* Consumer Defensive Sector Average

Performance Comparison

Bj's Wholesale Club Holdings

110.62

21.08

23.54%

COST

Costco

990.21

125.64

14.53%

DLTR

Dollar Tree

95.19

-13.46

-12.39%

Kroger Company

65.56

15.58

31.17%

TGT

Target

95.37

-44.63

-31.88%

WMT

Walmart

94.44

27.70

41.50%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.