Burlington Stores Target of Unusually High Options Trading (NYSE:BURL)

Key Points

• Unusually heavy options activity hit Burlington Stores, with investors buying 9,113 put options — about 262% above the normal volume — suggesting some traders were hedging against downside risk.
• Burlington shares fell sharply in Thursday trading, dropping to $291.67 on elevated volume, while the stock remains below its 50-day moving average and near the middle of its 52-week range.
• The company recently posted strong first-quarter results, earning $2.01 per share on $2.86 billion in revenue and beating expectations, and management raised its full-year outlook after reporting 14 straight quarters of double-digit EPS growth.

Burlington Stores, Inc. (NYSE:BURL - Get Free Report) was the recipient of unusually large options trading on Thursday. Investors purchased 9,113 put options on the stock. This represents an increase of 262% compared to the average volume of 2,516 put options.

Burlington Stores Stock Performance

Shares of BURL traded down $34.57 during mid-day trading on Thursday, reaching $291.67. 1,888,581 shares of the company's stock traded hands, compared to its average volume of 802,316. The company has a debt-to-equity ratio of 1.11, a quick ratio of 0.65 and a current ratio of 1.23. Burlington Stores has a 12 month low of $218.52 and a 12 month high of $351.85. The business's 50-day moving average price is $319.98 and its 200-day moving average price is $301.10. The stock has a market capitalization of $18.33 billion, a P/E ratio of 30.77, a price-to-earnings-growth ratio of 1.97 and a beta of 1.48.

Burlington Stores (NYSE:BURL - Get Free Report) last issued its quarterly earnings data on Thursday, May 28th. The company reported $2.01 earnings per share for the quarter, beating analysts' consensus estimates of $1.77 by $0.24. Burlington Stores had a net margin of 5.28% and a return on equity of 41.37%. The business had revenue of $2.86 billion for the quarter, compared to analysts' expectations of $2.80 billion. During the same period in the previous year, the business earned $1.67 earnings per share. The company's revenue was up 14.1% on a year-over-year basis. Equities analysts predict that Burlington Stores will post 11.3 earnings per share for the current year.

Insider Transactions at Burlington Stores

In related news, COO Travis Marquette sold 3,759 shares of the firm's stock in a transaction on Tuesday, March 24th. The stock was sold at an average price of $327.75, for a total transaction of $1,232,012.25. Following the transaction, the chief operating officer directly owned 26,350 shares in the company, valued at $8,636,212.50. This trade represents a 12.48% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which is available through this hyperlink. 1.30% of the stock is owned by company insiders.

Hedge Funds Weigh In On Burlington Stores

Several large investors have recently bought and sold shares of the stock. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. raised its holdings in Burlington Stores by 14.4% during the first quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. now owns 302 shares of the company's stock worth $72,000 after purchasing an additional 38 shares in the last quarter. Jones Financial Companies Lllp raised its holdings in Burlington Stores by 1,604.7% during the first quarter. Jones Financial Companies Lllp now owns 1,449 shares of the company's stock worth $345,000 after purchasing an additional 1,364 shares in the last quarter. EverSource Wealth Advisors LLC raised its holdings in Burlington Stores by 91.8% during the second quarter. EverSource Wealth Advisors LLC now owns 698 shares of the company's stock worth $162,000 after purchasing an additional 334 shares in the last quarter. Daiwa Securities Group Inc. raised its holdings in Burlington Stores by 12.4% during the second quarter. Daiwa Securities Group Inc. now owns 7,459 shares of the company's stock worth $1,735,000 after purchasing an additional 821 shares in the last quarter. Finally, AXA S.A. lifted its holdings in shares of Burlington Stores by 1,033.2% in the second quarter. AXA S.A. now owns 10,754 shares of the company's stock valued at $2,502,000 after buying an additional 9,805 shares during the period.

Key Burlington Stores News

Here are the key news stories impacting Burlington Stores this week:

• Positive Sentiment: Burlington reported first-quarter earnings of $2.01 per share on revenue of $2.86 billion, topping Wall Street estimates and showing 14.1% year-over-year revenue growth. Article Title
• Positive Sentiment: The company raised its full-year outlook after the quarter, signaling management is more confident in demand and execution as value-seeking shoppers continue to support the off-price model. Article Title
• Positive Sentiment: Management highlighted another quarter of strong operating momentum, with the company saying this was its 14th consecutive quarter of double-digit EPS growth. Article Title
• Neutral Sentiment: Analysts and preview reports had already expected an earnings beat, which may have reduced the upside surprise when the results were released. Article Title
• Neutral Sentiment: Unusual options activity showed heavier put buying, suggesting some traders were hedging against near-term downside despite the strong earnings report. Article Title
• Negative Sentiment: Investors may be worried that higher startup costs for the new Savannah distribution center could pressure margins later this year, even with strong sales growth. Article Title

Analyst Ratings Changes

Several research analysts have recently commented on BURL shares. Truist Financial started coverage on shares of Burlington Stores in a report on Monday, May 18th. They issued a "hold" rating and a $305.00 price target for the company. UBS Group reaffirmed a "buy" rating on shares of Burlington Stores in a research report on Tuesday, March 3rd. Weiss Ratings upgraded Burlington Stores from a "hold (c+)" rating to a "buy (b-)" rating in a research note on Monday, March 23rd. Telsey Advisory Group reiterated an "outperform" rating and issued a $365.00 target price on shares of Burlington Stores in a research note on Tuesday, March 31st. Finally, Wall Street Zen cut Burlington Stores from a "buy" rating to a "hold" rating in a research note on Saturday, April 25th. Sixteen research analysts have rated the stock with a Buy rating and five have given a Hold rating to the company. According to MarketBeat.com, the stock currently has a consensus rating of "Moderate Buy" and an average price target of $357.47.

Burlington Stores Company Profile

Burlington Stores, Inc is an American off-price retailer that sells apparel and home goods at discounted prices. The company's merchandise assortment includes clothing for women, men and children, plus baby products, footwear, accessories, beauty items, toys and home décor. Burlington's merchandising strategy focuses on offering branded and private-label goods at lower prices than traditional department stores by sourcing excess inventory, closeouts and opportunistic buys from manufacturers and other retailers.

The business traces its roots to the Burlington Coat Factory name established in the early 1970s and has since evolved into a broader off-price retailer that carries a wide range of seasonal and everyday merchandise.

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