If you have followed my research for any amount of time, you know I am very favorable toward stocks with strong momentum. It is an extremely well-researched market anomaly that can provide superior returns in a strong stock market like the one we are in today. Combine that with the Zacks Rank and you really have something special. One stock that recently jumped onto my radar due to powerful one-month momentum measures is Ollie's Bargain Outlet ((OLLI). The stock has numerous growth catalysts, a fantastic bu ...

Ollie's Bargain Outlet Holdings, Inc. (OLLI) has demonstrated remarkable resilience and growth potential in a challenging market environment. Based in Harrisburg, PA, Ollie's has defied industry trends by achieving a significant stock rally of 35.3% over the past six months, while the broader industry experienced a 1.6% decline. This performance highlights Ollie's ability to navigate through economic uncertainties and emerge stronger, showcasing its strategic and operational efficiency. Ollie's success lies ...

Investment action Review With this view, I expect OLLI to continue benefiting from a trade-down effect. Management had specifically called out that lower-income customers remained relatively stable, and trends from their lower-income customers were consistent vs. last quarter. In my view, this paints a very encouraging picture of underlying demand. OLLI's 1Q24 performance was very supportive of my view, as SSS growth of 3% was primarily driven by an increase in basket size (which contributed 2% of the 3%), ...

Core Insights - The Zacks Rank stock-rating system has a strong track record, with Zacks Rank 1 stocks generating an average annual return of +25% since 1988 [1] - Ollie's Bargain Outlet has been upgraded to a Zacks Rank 2, indicating a positive outlook based on earnings estimate revisions [3][4] - The correlation between earnings estimate revisions and stock price movements is significant, influenced by institutional investors [6][12] Earnings Estimate Revisions - Analysts have raised their earnings estimates for Ollie's Bargain Outlet, with a 2.4% increase in the Zacks Consensus Estimate over the past three months [8] - For the fiscal year ending January 2025, Ollie's is expected to earn $3.29 per share, reflecting a 13.1% increase from the previous year [14] Zacks Rating System - The Zacks rating system maintains a balanced approach, with an equal proportion of 'buy' and 'sell' ratings across over 4000 stocks, ensuring only the top 5% receive a 'Strong Buy' rating [9][10] - The upgrade for Ollie's Bargain Outlet signifies an improvement in its underlying business, likely leading to higher stock prices as investors respond positively [11][12]

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UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 Form 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended May 4, 2024 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Ollie's Bargain Outlet Holdings, Inc. (Exact name of registrant as specified in its charter) Delaware (State or other jurisdiction of incorporation) 001-37501 80-0848819 (Commission File Number) (IRS Emplo ...

Core Viewpoint - Ollie's Bargain Outlet is experiencing a surge in profitability, leading to a significant increase in its stock price, which has reached its highest level in nearly three years following the release of its fiscal Q1 2024 financial results [1][3]. Financial Performance - The company reported a same-store sales growth of 3% in Q1, which, while modest, exceeded expectations and positively impacted profit margins [2][3]. - Ollie's operating income for Q1 surged by nearly 47% to almost $57 million, with expectations to earn at least $250 million for the year, a substantial figure given its market capitalization of approximately $5.5 billion [3]. Business Strategy and Positioning - Ollie's focuses on offering closeout merchandise at low prices, appealing to consumers seeking bargains, especially in challenging economic times [2]. - The company is steadily opening new stores and is strategically positioned to capitalize on opportunities, as evidenced by its recent acquisition of 11 stores from the bankrupt 99 Cents Only Stores for under $15 million [4][5]. Financial Health - With nearly $350 million in cash and no debt, Ollie's is in a strong financial position, allowing it to be patient and take advantage of market opportunities [5]. Long-term Outlook - Despite the current stock price highs, there is potential for further long-term upside for shareholders, indicating a positive outlook for the company's future performance [6].

Ollie's Bargain Outlet Holdings, Inc. (OLLI) reported first-quarter fiscal 2024 results, wherein both the top and bottom lines not only beat the Zacks Consensus Estimate but also increased year over year. This Harrisburg, PA-based company also witnessed an uptick in comparable store sales. The company's focus on value-driven merchandise assortments positioned it well to capitalize on opportunities in the marketplace and effectively meet consumer demand. The better-than-expected performance prompted manageme ...

Financial Data and Key Metrics Changes - In Q1 2024, net sales increased by 11% to $509 million, driven by new store growth and a 3% increase in comparable store sales [30] - Operating income rose by 47% to $56 million, with operating margin increasing by 270 basis points to 11.1% [54] - Adjusted net income increased by 47% to $45 million, and adjusted earnings per share rose by 49% to $0.73 [54] - Gross margin improved by 220 basis points to 41.1%, primarily due to favorable supply chain costs and higher merchandise margins [31] Business Line Data and Key Metrics Changes - The company opened four new stores, ending the quarter with 516 stores across 30 states, marking an 8% year-over-year increase [31] - Over 50% of product categories reported positive comparable sales, with strong performance in lawn and garden, housewares, food, sporting goods, and candy [53] Market Data and Key Metrics Changes - The company is experiencing growth in the younger customer demographic, with Ollie's Army membership increasing by 7% to 14.2 million members, representing over 80% of total sales [53] - The company noted a trade-down effect, with higher-income consumers seeking value, particularly in the $100,000 to $150,000 household income range [66] Company Strategy and Development Direction - The company is focused on expanding its footprint, with plans to open a total of 50 new stores, while also acquiring 11 99 Cents Only Stores to strengthen its market presence in Texas [35][58] - Investments in supply chain, store operations, and marketing are aimed at enhancing execution and driving long-term growth [23][50] - The company is shifting advertising dollars towards digital and social media platforms to attract younger customers [51] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength of deal flow and operational improvements, which are expected to continue supporting growth [100] - The company anticipates a flat comparable sales growth in Q3 due to a shift in promotional flyers, with expectations for Q4 comps to be slightly above long-term averages [35] - Management remains cautious about supply chain costs and is planning conservatively for the remainder of the year [152] Other Important Information - The company ended the quarter with $342 million in cash and short-term investments, with no outstanding borrowings under its revolving credit facility [32] - The company is committed to returning capital to investors through share repurchases, having bought back $25 million of its common stock during the quarter [33] Q&A Session Summary Question: Consumer health and outlook - Management noted that the trade-down effect is still prevalent among higher-income consumers, with stability in lower-income cohorts [66][67] Question: Characteristics of new stores - The new stores are in the mid-20,000 square feet range, smaller than the average, which helps with inventory management [72] Question: Competitive environment for closeout deals - Management indicated that competition in the closeout market remains limited, allowing the company to secure favorable deals [78] Question: Drivers of gross margin strength - The gross margin increase was primarily due to supply chain improvements and favorable merchandise margins [83] Question: Shrink control update - Shrink remains elevated but has plateaued, with ongoing efforts to improve control [129] Question: Economics of 99 Cents Only Stores - The new stores are expected to be slightly less productive in sales but will have lower occupancy and payroll costs, making them economically viable [130]