Group 1 - Boot Barn (BOOT) is currently outperforming its peers in the Retail-Wholesale sector with a year-to-date return of 85.5%, compared to the sector average of 15.1% [4] - The Zacks Rank for Boot Barn is 1 (Strong Buy), indicating a positive earnings outlook and strong analyst sentiment, with a consensus estimate for full-year earnings having increased by 8.4% over the past three months [3][4] - Boot Barn belongs to the Retail - Apparel and Shoes industry, which has an average gain of 16.2% this year, further highlighting its strong performance relative to the industry [6] Group 2 - Carvana (CVNA) is another strong performer in the Retail-Wholesale sector, with a year-to-date return of 201.8% and a Zacks Rank of 2 (Buy) [5] - The Internet - Commerce industry, which includes Carvana, has seen an average increase of 15.3% this year, indicating that while Carvana is performing well, it is still behind Boot Barn in terms of year-to-date returns [6] - Investors are encouraged to monitor both Boot Barn and Carvana for continued strong performance in the Retail-Wholesale sector [7]

Company Performance - Boot Barn's shares have increased by 3.1% over the past month and reached a new 52-week high of $138.78, with a year-to-date gain of 76% compared to 8.8% for the Zacks Retail-Wholesale sector and 8.1% for the Zacks Retail - Apparel and Shoes industry [1] - The company has consistently exceeded earnings expectations, reporting EPS of $1.2 against a consensus estimate of $1.08 in its last earnings report on August 7, 2024, and beating revenue estimates by 1.78% [2] Financial Projections - For the current fiscal year, Boot Barn is projected to achieve earnings of $5.28 per share on revenues of $1.84 billion, reflecting an 8.87% increase in EPS and a 10.67% increase in revenues [3] - In the next fiscal year, earnings are expected to rise to $6.26 per share on $2.1 billion in revenues, indicating year-over-year changes of 18.56% and 13.75%, respectively [3] Valuation Metrics - Boot Barn has a Value Score of B, a Growth Score of B, and a Momentum Score of F, resulting in a combined VGM Score of B [6] - The stock trades at 25.6 times current fiscal year EPS estimates, which is a premium compared to the peer industry average of 15.8 times, and at 20.4 times trailing cash flow versus an average of 8.2 times for its peer group [6] Zacks Rank - Boot Barn holds a Zacks Rank of 1 (Strong Buy) due to favorable earnings estimate revisions from analysts [7] - The company meets the criteria for investors looking for stocks with a Zacks Rank of 1 or 2 and Style Scores of A or B, indicating potential for future growth [8] Industry Comparison - Boot Barn's performance is notable within the Retail - Apparel and Shoes industry, which ranks in the bottom 70% of all industries, yet it shows strong fundamentals and potential tailwinds [11]

Financial Data and Key Metrics Changes - Revenue increased by 10% to $423 million, with consolidated same-store sales growth of 1.4% [4][14] - Earnings per diluted share rose to $1.26 from $1.13 in the prior year [6][14] - Merchandise margin expanded by 100 basis points due to supply chain efficiencies [6][14] Business Line Data and Key Metrics Changes - Retail store same-store sales grew by 0.8%, while e-commerce same-store sales increased by 6.7% [4][14] - Men's Western boots and apparel led the merchandise category with mid-single-digit comp growth [9] - Ladies Western boots saw low single-digit comp growth, while Ladies Apparel experienced a low single-digit decline [9] Market Data and Key Metrics Changes - The company opened 11 new stores, bringing the total to 411 across 46 states [7] - The e-commerce channel showed strong performance, with bootbarn.com sales growing approximately 14% [10] Company Strategy and Development Direction - The company aims to open 60 new stores this fiscal year, maintaining a commitment to 15% square footage growth annually [7][19] - Focus on expanding exclusive brand penetration, which increased to 38.1% [11] - The company is enhancing its omnichannel strategy, with over half of online orders fulfilled by stores [10] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding consumer sentiment and macroeconomic uncertainty [12][20] - The company raised its full-year sales guidance to $1.85 billion, reflecting an 11% growth over fiscal '24 [17][18] - Management noted challenges in mid-July due to external factors but reported a return to positive sales growth afterward [12] Other Important Information - Inventory increased by 11% year-over-year to $627 million, with a 6% increase on a same-store basis [15] - The company is focused on supply chain efficiencies and vendor direct purchasing to enhance margins [11][55] Q&A Session All Questions and Answers Question: Can you break down the drivers behind the return to positive same-store sales? - Management noted broad-based sequential improvement across merchandise categories, geographies, and channels, with positive growth in average transactions per store in May and June [22][23] Question: What are the puts and takes in the second quarter gross margin? - Management expects a 60 basis point improvement in merchandise margin driven by supply chain efficiencies, with a 90 basis point deleverage in buying and occupancy costs [26] Question: How are company-specific initiatives impacting sales? - Management highlighted efforts to balance pricing across product assortments and shift marketing focus to generate immediate demand, resulting in positive growth in units per transaction [28][31] Question: What is the impact of the Morgan Wallen sponsorship? - Management reported an uptick in customer capture, particularly among younger and female demographics, correlating with the sponsorship [32] Question: How is the workwear side of the business trending? - Management indicated that work boots saw slight sequential improvement, while work apparel remains negative but is being addressed through assortment changes [35] Question: How is the company managing sourcing exposure from China? - Management has reduced sourcing exposure from China to about 37-38% and continues to monitor risks associated with potential tariff increases [39] Question: What changes have been made in the online channel? - Management implemented assortment changes and improved online marketing strategies, resulting in a recovery in e-commerce sales [42][43]

Core Insights - Boot Barn reported revenue of $423.39 million for the quarter ended June 2024, a year-over-year increase of 10.3% and a surprise of +1.78% over the Zacks Consensus Estimate of $415.98 million [1] - The EPS for the same period was $1.20, compared to $1.11 a year ago, with an EPS surprise of +11.11% against the consensus estimate of $1.08 [1] Performance Metrics - Same Store Sales growth was 1.4%, outperforming the estimated decline of -0.9% by four analysts [3] - Average store square footage at the end of the period was 11,063, exceeding the estimated 10,928 by two analysts [3] - The company opened/acquired 11 stores, slightly below the average estimate of 13 based on two analysts [4] - Total stores operating at the end of the period reached 411, surpassing the average estimate of 403 by two analysts [5] Stock Performance - Boot Barn shares have returned -5.8% over the past month, compared to the Zacks S&P 500 composite's -5.9% change [5] - The stock currently holds a Zacks Rank 1 (Strong Buy), indicating potential for outperformance in the near term [5]

Core Insights - Boot Barn (BOOT) reported quarterly earnings of $1.20 per share, exceeding the Zacks Consensus Estimate of $1.08 per share, and showing an increase from $1.11 per share a year ago, resulting in an earnings surprise of 11.11% [1] - The company achieved revenues of $423.39 million for the quarter ended June 2024, surpassing the Zacks Consensus Estimate by 1.78% and increasing from $383.7 million year-over-year [2] - Boot Barn's stock has increased approximately 53.2% since the beginning of the year, significantly outperforming the S&P 500's gain of 9.9% [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.92 on revenues of $403.35 million, while for the current fiscal year, the estimate is $5.08 on revenues of $1.82 billion [7] - The estimate revisions trend for Boot Barn is favorable, leading to a Zacks Rank 1 (Strong Buy) for the stock, indicating expected outperformance in the near future [6] Industry Context - The Retail - Apparel and Shoes industry, to which Boot Barn belongs, is currently ranked in the bottom 38% of over 250 Zacks industries, suggesting potential challenges ahead [8] - Sportsman's Warehouse (SPWH), another company in the same industry, is expected to report a quarterly loss of $0.09 per share, reflecting a year-over-year decline of 125%, with revenues projected at $284 million, down 8.2% from the previous year [9]

Financial Performance - Boot Barn reported net income of $38,909,000 for the 13 weeks ended June 29, 2024, compared to $34,253,000 for the same period last year, representing an increase of approximately 13.3%[85]. - Basic earnings per share increased to $1.28 from $1.14 year-over-year, while diluted earnings per share rose to $1.26 from $1.13[85]. - Net sales increased by $39.7 million, or 10.3%, to $423.4 million for the thirteen weeks ended June 29, 2024, compared to $383.7 million for the same period in 2023[113]. - Gross profit rose by $14.7 million, or 10.4%, to $156.7 million, maintaining a gross profit margin of 37.0% for both periods[114]. - Income from operations increased by $4.0 million, or 8.6%, to $50.2 million, with an operating margin of 11.9%[116]. - Net income for the period was $38.9 million, up from $34.3 million, reflecting an increase in the effective tax rate to 22.9% from 24.6%[117]. - Same store sales growth was 1.4%, with e-commerce same store sales increasing by 6.7%[113]. Store Operations and Growth Strategy - As of June 29, 2024, Boot Barn operated 411 stores across 46 states, alongside its e-commerce platforms, indicating a robust retail presence[91]. - The company anticipates that a percentage of future net sales will come from new store openings, which are integral to its growth strategy[100]. - The company operated 411 stores at the end of the period, up from 361 stores in the previous year[118]. Expenses and Profitability - Selling, general and administrative (SG&A) expenses increased by $10.8 million, or 11.3%, to $106.5 million, with SG&A as a percentage of net sales rising to 25.2% from 24.9%[115]. - Selling, general and administrative expenses are expected to rise due to increased stock-based compensation and the growth of the store network[107]. - Gross profit is closely tied to net sales, with the company regularly analyzing components such as initial markups and markdowns to maintain profitability[104]. Cash Flow and Capital Expenditures - Cash and cash equivalents increased to $83.4 million as of June 29, 2024, compared to $75.8 million as of March 30, 2024[126]. - Net cash provided by operating activities was $41.3 million for the thirteen weeks ended June 29, 2024, down from $70.8 million for the same period in 2023[127]. - Net cash used in investing activities was $27.1 million for the thirteen weeks ended June 29, 2024, compared to $29.9 million for the same period in 2023, indicating a decrease of 9.4%[129]. - Total capital expenditures for fiscal 2025 are estimated to be between $115.0 million and $120.0 million, including investments in a new distribution center[120]. - Capital expenditures for store construction and improvements to the Kansas City distribution center were significant contributors to the investing activities in both periods[129]. - Net cash used in financing activities was $6.7 million for the thirteen weeks ended June 29, 2024, a substantial decrease from $42.0 million in the same period of 2023, reflecting a reduction of 84.0%[130]. Market and Economic Factors - Boot Barn's business is sensitive to consumer discretionary spending, with economic conditions and consumer confidence playing significant roles in its performance[90]. - Boot Barn's same store sales metrics are influenced by various factors, including economic trends, consumer preferences, and competition, which are critical for assessing performance[99]. - The company is subject to interest rate risk due to borrowings under its credit facility, which bears interest at variable rates[131]. - There were no material changes in the market risks as described in the "Quantitative and Qualitative Disclosure of Market Risks" section of the Fiscal 2024 10-K[132]. - The company has not reported significant changes to its critical accounting policies and estimates as of the latest filing[109].

Financial Performance - Net sales increased by 10.3% to $423.4 million compared to $383.7 million in the prior-year period[1][2] - Gross profit was $156.7 million, maintaining a gross profit margin of 37.0%[3] - Net income increased to $38.9 million, or $1.26 per diluted share, compared to $34.3 million, or $1.13 per diluted share in the prior-year period[5] - Net sales for the thirteen weeks ended June 29, 2024, were $423,386,000, an increase of 10.4% compared to $383,695,000 for the same period last year[17] - Gross profit for the same period was $156,749,000, representing a gross margin of 37.0%, up from $141,963,000 and a margin of 36.9% in the prior year[17] - Net income for the thirteen weeks ended June 29, 2024, was $38,909,000, compared to $34,253,000 for the same period last year, reflecting a year-over-year increase of 13.3%[17] - Basic earnings per share increased to $1.28 for the current quarter, up from $1.14 in the same quarter last year[17] Sales and Store Performance - Same store sales grew by 1.4%, with retail store same store sales up 0.8% and e-commerce same store sales up 6.7%[1][2] - Same store sales growth for the quarter was 1.4%, a recovery from a decline of 5.9% in the previous quarter[21] - Same store sales are expected to decline approximately (1.0)% to grow by 1.2% for fiscal year 2025[9] Expenses and Financial Guidance - Selling, general and administrative expenses rose to $106.5 million, or 25.2% of net sales, compared to 24.9% in the prior-year period[4] - Total sales guidance for fiscal year 2025 is set between $1.816 billion and $1.850 billion, representing growth of 8.9% to 11.0%[9] Store Expansion and Capital Expenditures - The company plans to open 60 new stores in fiscal year 2025[9] - The company opened 11 new stores during the quarter, bringing the total store count to 411 as of June 29, 2024[20] - Capital expenditures are projected to be between $115.0 million and $120.0 million for fiscal year 2025[11] Cash and Assets - The company had cash of $83 million and no drawn amounts under its $250 million revolving credit facility as of June 29, 2024[8] - Cash and cash equivalents at the end of the period were $83,387,000, up from $17,099,000 at the end of the previous year[19] - Total assets increased to $1,774,459,000 as of June 29, 2024, compared to $1,705,592,000 at the end of the previous quarter[16] Operating Cash Flow - Operating cash flow for the thirteen weeks ended June 29, 2024, was $41,311,000, compared to $70,802,000 for the same period last year[19] - The company reported a total of 4,547 thousand square feet of retail store selling space at the end of the period, an increase from 4,371 thousand square feet in the previous quarter[21]

Core Viewpoint - Boot Barn has demonstrated a strong performance in beating earnings estimates, with a notable surprise in the most recent quarter, indicating positive momentum in its earnings prospects [1][5][7]. Earnings Performance - For the latest quarter, Boot Barn reported earnings of $1.01 per share, exceeding the expected $0.89 per share, resulting in a surprise of 13.48% [1]. - In the previous quarter, the company reported $1.81 per share against an estimate of $1.80, achieving a surprise of 0.56% [1]. - The average surprise for Boot Barn over the last two quarters was 7.02% [5]. Earnings ESP and Analyst Sentiment - Boot Barn currently has an Earnings ESP of +6.19%, indicating a positive outlook from analysts regarding the company's earnings potential [7]. - The positive Earnings ESP, combined with a Zacks Rank of 2 (Buy), suggests a strong likelihood of another earnings beat in the upcoming report [7]. - Recent estimates for Boot Barn have been trending higher, reflecting increased analyst optimism [6]. Industry Context - Boot Barn operates within the Zacks Retail - Apparel and Shoes industry, positioning it well for continued performance in earnings surprises [9].

Core Viewpoint - Boot Barn is expected to report a stable same-store sales performance in Q1/FY2025, despite recent declines, with Wall Street analysts estimating revenues to reach $415.4 million, an 8.3% year-on-year increase, and an adjusted EPS of $1.06, down $0.07 from the prior year's Q1 [8][10]. Financial Performance - In Q4, Boot Barn reported a -5.9% consolidated same-store sales decline, which is worse than Designer Brands' -2.5% and Shoe Carnival's -3.4% declines [1]. - The company's FY2025 guidance anticipates a slow same-store sales performance ranging from -3.6% to -1.6%, with total sales projected between $1,766 million and $1,800 million [14]. - Profitability is expected to take a moderate hit due to slower same-store sales, with an EPS forecast of $4.55 to $4.85, down from $4.80 in FY2024 [14]. Growth Projections - Revenue is estimated to grow by 6.5% in FY2025, with a total revenue CAGR of 8.3% from FY2024 to FY2034, followed by a 2.5% perpetual growth rate [3]. - Boot Barn's EBIT margin is projected to reach 12.5% with improved consumer sentiment and operating leverage from store openings [3]. Store Expansion - Boot Barn continues its store expansion, aiming for 900 stores by FY2030, having added 18 new stores in Q4, bringing the total to 400, with 60 new stores planned for FY2025 [15]. - The company expects capital expenditures of $115-120 million for FY2025, with an initial investment of approximately $1.5 million per new store [15]. Valuation Insights - The fair value estimate for Boot Barn is calculated at $103.21, indicating that the stock may be overvalued unless margins improve significantly [17]. - The weighted average cost of capital (WACC) is estimated at 10.21%, down from 12.47% previously, reflecting a lower cost of capital [18].

Company Performance - Boot Barn Holdings' shares have increased by 51.5% over the past three months, significantly outperforming the industry average of 1.9% [1] - The company's revenue for fiscal 2024 reached approximately $1.7 billion, marking a 100% increase compared to pre-pandemic levels from four years ago [13] - For fiscal 2025, Boot Barn Holdings projects total sales between $1.766 billion and $1.800 billion, indicating a growth of 5.9% to 8% over fiscal 2024 [14] Strategic Initiatives - The company has successfully increased its exclusive brand penetration by 370 basis points to 37.7% for the full year, enhancing product offerings and margin profile [4] - Boot Barn's merchandise margin improved by 160 basis points for the full year, driven by better freight costs and product margins, showcasing effective cost management [7] - The introduction of artificial intelligence in customer interactions has improved customer experience and brand loyalty, contributing to sales growth [6] Expansion and Growth Strategy - Boot Barn opened 55 new stores in fiscal 2024, exceeding initial plans, and has expanded from 86 stores in eight states to 400 stores across 45 states over the past 12 years [19] - The new stores have demonstrated strong performance, generating a 60% cash-on-cash return on capital in their first year [19] - The company aims for a steady pace of 15% new unit growth annually, supported by strong financial fundamentals and strategic initiatives [18]