What Happened?
Shares of discount retail company Ollie’s Bargain Outlet (NASDAQ:OLLI) jumped 4% in the afternoon session after the stock's positive momentum continued as the company reported third-quarter results that beat profit expectations and raised its full-year guidance, leading to mixed analyst reactions.
The discount retailer's third-quarter adjusted earnings per share reached $0.75, surpassing consensus estimates. In response to the performance, which was driven by better-than-expected margins, management increased its fiscal 2025 earnings per share forecast. The news prompted varied responses from financial analysts. BofA Securities raised its price target on the stock to $150, noting that Ollie's value proposition resonated with consumers. Conversely, UBS Group reduced its price objective to $130. The stock's upward move suggested investors focused on the positive earnings beat and improved outlook.
The shares closed the day at $116.12, up 3.3% from previous close.
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What Is The Market Telling Us
Ollie’s shares are somewhat volatile and have had 11 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 2 days ago when the stock dropped 3.8% on the news that the company reported mixed third-quarter results, where an earnings beat and raised guidance were overshadowed by revenue that fell just short of expectations. Ollie's posted earnings of $0.75 per share, which topped the analyst consensus of $0.73. However, revenue for the period came in at $613.6 million, narrowly missing Wall Street's estimate of $615.3 million. Despite the slight revenue miss, the company's net sales still increased by 18.6% compared to the same period in the previous year. Furthermore, management lifted its sales and earnings outlook for the full year. The market's negative reaction suggested that investors were focused on the revenue miss, indicating that expectations were high heading into the report.
Ollie's is up 7.3% since the beginning of the year, but at $116.12 per share, it is still trading 17.5% below its 52-week high of $140.80 from August 2025. Investors who bought $1,000 worth of Ollie’s shares 5 years ago would now be looking at an investment worth $1,463.
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