Core Insights - The article emphasizes the investment philosophy focused on small cap companies, highlighting the importance of identifying mispriced securities through understanding financial drivers and utilizing DCF model valuation [1] Investment Philosophy - The investment approach is not confined to traditional categories such as value, dividend, or growth investing, but rather considers all prospects of a stock to assess risk-to-reward [1]

BJ’s Wholesales (BJ) Q4 2025 Earnings Call March 06, 2025 08:30 AM ET Company Participants Catherine Park - VP - Investor RelationsBob Eddy - Chairman & CEOPeter Benedict - Managing Director - Equity ResearchLaura Felice - Executive VP & CFOEdward Kelly - Managing Director - Equity ResearchBill Werner - EVP - Strategy & DevelopmentOliver Chen - Managing Director - Retail, Luxury, New Platforms Sector HeadChuck Grom - Managing DirectorSimeon Gutman - Managing Director Conference Call Participants Robert Ohme ...

BJ's Wholesale Club (BJ) came out with quarterly earnings of $0.93 per share, beating the Zacks Consensus Estimate of $0.87 per share. This compares to earnings of $1.11 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 6.90%. A quarter ago, it was expected that this wholesale membership warehouse operator would post earnings of $0.91 per share when it actually produced earnings of $1.18, delivering a surprise of 29.67%.Over the ...

Core Viewpoint - BJ's Wholesale Club Holdings Inc. provided a full-year outlook that aligns with Wall Street expectations, which is a positive signal in contrast to many competitors [1] Financial Performance - The company exceeded expectations for all three key earnings metrics in its fourth quarter [1] - BJ's Wholesale Club posted the fastest growth in comparable-club sales in nearly two years [1]

Financial Performance - Net sales for the fourth quarter of fiscal 2024 were $5,161.5 million, a decline of 1.7% compared to $5,248.9 million in the fourth quarter of fiscal 2023[4] - Comparable club sales increased by 4.0% year-over-year in the fourth quarter and 2.5% for the full fiscal year, with a 4.6% increase excluding gasoline sales in the fourth quarter[9] - Net income for the fourth quarter decreased to $122.7 million, down 15.9% from $145.9 million in the same quarter last year, while full-year net income increased to $534.4 million[9] - Operating income for the fourth quarter was $178.4 million, a decrease of 16.6% from $214.0 million in the fourth quarter of fiscal 2023[4] - Adjusted EBITDA decreased by 9.0% to $264.6 million in the fourth quarter of fiscal 2024, while it increased by 0.8% to $1.09 billion for the full fiscal year[9] - Operating income for the 52 weeks ended February 1, 2025, was $772,206, down 3.52% from $800,419 for the previous year[18] - Net income for the 52 weeks ended February 1, 2025, was $534,417, a slight increase of 2.59% compared to $523,741 for the 53 weeks ended February 3, 2024[22] Membership and Fees - Membership fee income increased by 7.9% year-over-year to $117.0 million in the fourth quarter of fiscal 2024, and $456.5 million for the full fiscal year, up 8.5% from $420.7 million in fiscal 2023[5] - The company achieved a 90% tenured member renewal rate during fiscal 2024, indicating strong member retention[5] - Membership fee income increased to $116,990 for the 13 weeks ended February 1, 2025, up 7.36% from $108,405 for the same period last year[18] Future Projections - The company expects comparable club sales, excluding gasoline, to increase by 2.0% to 3.5% year-over-year in fiscal 2025[10] - Capital expenditures are projected to be approximately $800 million, driven by the construction of new clubs and a distribution center[10] Cash Flow and Investments - Net cash provided by operating activities for the 52 weeks ended February 1, 2025, was $900,872, an increase of 25.23% from $718,883 for the previous year[22] - The company reported a net cash used in investing activities of $589,566 for the 52 weeks ended February 1, 2025, compared to $454,765 for the previous year, indicating increased investment activity[22] - The company reported net cash provided by operating activities of $271,917 for the 13 weeks ended February 1, 2025, slightly down from $274,352 for the previous year[40] - Adjusted free cash flow for the 13 weeks ended February 1, 2025, was $111,487, a decrease of 28.3% compared to $155,228 for the 14 weeks ended February 3, 2024[40] Debt and Leverage - Total debt as of February 1, 2025, was $573,807, with net debt calculated at $545,535 after accounting for cash and cash equivalents of $28,272[41] - The net debt to LTM adjusted EBITDA ratio stood at 0.5x, indicating a stable leverage position[41] Operational Efficiency - BJ's Wholesale Club continues to focus on operational efficiency and cost management strategies to navigate the current market challenges[36] - Stock-based compensation expense increased to $18,158 for the 13 weeks ended February 1, 2025, from $10,010 in the previous year[37] - The company incurred restructuring charges of $1,151 for the 13 weeks ended February 1, 2025, compared to $5,512 for the 14 weeks ended February 3, 2024[37]

Core Viewpoint - BJ's Wholesale Club Holdings, Inc. is expected to report a slight decline in revenue and a significant decrease in earnings per share for the fourth quarter of fiscal 2024, with revenues estimated at $5.35 billion, reflecting a 0.1% drop year-over-year, and earnings per share projected at 88 cents, indicating a 20.7% decline from the previous year [1][2]. Revenue and Earnings Expectations - The Zacks Consensus Estimate for BJ's revenue is $5.35 billion, which represents a 0.1% decrease from the prior year's figure [1]. - The earnings per share estimate has increased slightly to 88 cents, but this still suggests a year-over-year decline of 20.7% [2]. Membership and Sales Growth - BJ's Wholesale is focusing on simplifying product assortments, enhancing marketing and merchandising, and expanding into high-demand categories, which is expected to contribute to a 6.3% increase in membership fee income for the quarter [4]. - Merchandise comparable club sales are anticipated to rise by 2.8% for the quarter, driven by better pricing, private-label offerings, and digital solutions [5]. Cost and Margin Challenges - The company is facing challenges such as cautious consumer spending and a projected 4.2% increase in selling, general and administrative (SG&A) expenses, which may lead to an operating margin contraction of 80 basis points [6]. Earnings Prediction Model - The Zacks model indicates a likelihood of an earnings beat for BJ's Wholesale, supported by a positive Earnings ESP of +4.28% and a Zacks Rank of 2 (Buy) [7][8].

Core Insights - BJ's Wholesale Club is expected to report quarterly earnings of $0.88 per share, a decline of 20.7% year-over-year, with revenues forecasted at $5.35 billion, reflecting a decrease of 0.1% compared to the same period last year [1] Earnings Estimates - The consensus EPS estimate has been revised 1.2% higher in the last 30 days, indicating a collective reevaluation by analysts [2] - Revisions to earnings projections are crucial for predicting investor behavior and have a strong correlation with short-term stock price performance [3] Revenue Projections - Analysts project 'Revenues- Net sales' to reach $5.15 billion, suggesting a year-over-year change of -1.9% [4] - The average estimate for 'Revenues- Membership fee income' is $114.05 million, indicating a year-over-year increase of 5.2% [5] Operational Metrics - Analysts expect the number of 'Warehouse Clubs' to increase to 254 from 244 in the same quarter last year [5] - The consensus for 'Gas Stations' is projected to reach 188, up from 175 in the same quarter of the previous year [5] Stock Performance - BJ's shares have increased by 2.2% over the past month, contrasting with a -1.3% change in the Zacks S&P 500 composite [6] - With a Zacks Rank 2 (Buy), BJ is anticipated to outperform the overall market in the near future [6]

Core Viewpoint - BJ's Wholesale Club is anticipated to report a year-over-year decline in earnings due to lower revenues, with the consensus outlook indicating a potential impact on its near-term stock price [1][2]. Earnings Expectations - The earnings report is scheduled for March 6, 2025, with expectations of quarterly earnings at $0.86 per share, reflecting a year-over-year decrease of 22.5%. Revenues are projected to be $5.35 billion, down 0.1% from the previous year [3][2]. Estimate Revisions - The consensus EPS estimate has remained unchanged over the last 30 days, indicating that analysts have not significantly reassessed their initial estimates during this period [4]. Earnings Surprise Prediction - The Zacks Earnings ESP model suggests that the Most Accurate Estimate for BJ's is higher than the Zacks Consensus Estimate, resulting in a positive Earnings ESP of +1.79%, indicating a bullish outlook from analysts [10][11]. Historical Performance - BJ's has a strong earnings surprise history, having beaten consensus EPS estimates in the last four quarters, including a notable surprise of +29.67% in the last reported quarter [12][13]. Investment Considerations - While BJ's is positioned as a compelling earnings-beat candidate, investors are advised to consider other factors that may influence stock performance beyond just earnings results [14][16].

Core Viewpoint - BJ's Wholesale Club is showing potential for a bullish trend as it has crossed above the 20-day moving average, indicating a key level of support and a positive short-term outlook [1][2]. Technical Analysis - The stock has recently moved 6.6% higher over the last four weeks, suggesting a possible rally ahead [3]. - The 20-day simple moving average is a significant trading tool that helps in identifying trend reversals and smoothing out price fluctuations [1][2]. Earnings Estimates - BJ's earnings estimates have seen positive revisions, with no estimates decreasing in the past two months and two estimates increasing, leading to a consensus estimate rise [3]. - The company currently holds a Zacks Rank of 2 (Buy), reinforcing the bullish sentiment [3]. Investment Outlook - Given the technical indicators and positive earnings revisions, BJ's Wholesale Club may present further investment opportunities in the near future [4].

Company Overview - BJ's Wholesale Club currently holds a Momentum Style Score of B, indicating potential for strong performance in the momentum investing strategy [3][12] - The company has a Zacks Rank of 2 (Buy), which suggests it is expected to outperform the market [4][12] Price Performance - Over the past week, BJ's shares have increased by 1.46%, while the Zacks Consumer Services - Miscellaneous industry remained flat [6] - In the last month, BJ's shares have risen by 10.82%, significantly outperforming the industry's 1.51% [6] - Over the past quarter, BJ's shares have increased by 9.02%, and over the last year, they have gained 52.63%, compared to the S&P 500's increases of 4.18% and 24.21%, respectively [7] Trading Volume - BJ's average 20-day trading volume is 1,339,006 shares, which serves as a baseline for price-to-volume analysis [8] Earnings Estimates - In the past two months, two earnings estimates for BJ have been revised upwards, while none have been revised downwards, leading to an increase in the consensus estimate from $3.95 to $3.96 [10] - For the next fiscal year, one estimate has moved upwards with no downward revisions during the same period [10]