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Ollie's Bargain Outlet Holdings announced better than expected third quarter earnings Tuesday and a new CEO that sent the stock 12% higher. The US consumer is shopping on-line with $AMZN, $BBY and $WMT and discount and closeout retailers like $OLLI and Big Lots $BIG.

Ollies

There is a huge part of the US retail consumer economy that is hurting, we know that from the Trump election among other statistics. We know convenience and entitlement are also huge factors, it is hard to beat $AMZN deliveries at your day at a cheaper price.

Ollie's Bargain Outlet Holdings Inc NASDAQ: OLLI Reported Earnings After Close Tuesday

$0.09 Beat $0.07 EPS And $154.4M Beat $149.5 Million Forecast in Revenue

Last Friday Tuesday discount and closeout retailer Big Lots, Inc. (BIG) reported Q3 earnings that sent the stock for its biggest run in 30 years after it had retested 2008 lows. The report on the back of traditional and online reports tell a lot of why Target and J..Penney among others are in a retail death spiral. We want things cheap and we want them now and if we don't have money lets get closeouts and discounts.

Earnings:

Ollie's Bargain Outlet Holdings reported third-quarter results above Wall Street expectations. Ollie's said it earned $27 million, or 41 cents a share, in the quarter, compared with $24.8 million, or 38 cents a share, in the year-ago quarter. Adjusted for one-time items, Ollie's earned $26.8 million, or 41 cents a share, compared with $21 million, or 32 cents a share, in the year-ago quarter.

Sales rose 15% to $327 million, from $284 million a year ago. Analysts polled by FactSet had expected the company to report GAAP and adjusted earnings of 38 cents a share on sales of $323 million.

Ollie's Bargain Outlet Holdings Inc NASDAQ: OLLI

Market Reaction - After hours 67.00 +6.70 (+11.11%)

Highlights

  • Total net sales increased 15.3% to $327.0 million.
  • Comparable store sales decreased 1.4% compared to a 4.6% increase in the prior year.
  • The Company opened 13 stores during the quarter, ending the period with a total of 345 stores in 25 states, a 16.2% year-over-year increase in store count.
  • Operating income increased 22.0% to $35.7 million.
  • Net income increased 8.6% to $27.0 million and net income per diluted share increased 7.9% to $0.41.
  • Adjusted net income increased 28.3% to $26.8 million and adjusted net income per diluted share  increased 28.1% to $0.41.
  • Adjusted EBITDA increased 22.5% to $42.6 million.
  • The Company repurchased $40.0 million of its common stock in the third quarter of fiscal 2019.

New CEO

Ollie's also named a new chief executive. Ollie's said its board has appointed John Swygert as the company's president and CEO, effective immediately. Swygert has been interim CEO since Dec. 2 after the death of company's founder Mark Butler. Swygert, Ollie's former chief operating officer and chief financial officer, worked alongside Butler for nearly 16 years, the company said.

We now live in a world of central bank easing and printing for the last 8 years, a situation where a populist business man is running the US and a Federal Reserve in a tightening cycle. How has this helped the little man?

Outlook

Looking ahead into fiscal 2019, the company reaffirmed its total net sales outlook of $1.419-1.430 billion and comparable-store sales estimates to decline in a range of 0.5-1.5%. The consensus estimates sales of $1.43 billion.

Adjusted earnings are still anticipated to be $130-133 million or $1.95-2.00 per share for the full year. The consensus estimates earnings of $1.96 per share.

Capital expenditures are still predicted to be in the range of $75-80 million for fiscal 2019.

Source: Ollies, TradersCommunity

From The TradersCommunity News Desk

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