OLLI

Ollies Bargain Outlet Holdings Inc

Consumer


Presented:03/30/2022
Price:$43.90
Cap:$2.75B
Current Price:$94.68
Cap:$5.81B

Presented

Date03/30/2022
Price$43.90
Market Cap$2.75B
Ent Value$3.03B
P/E Ratio18.11x
Book Value$20.54
Div Yield0%
Shares O/S62.69M
Ave Daily Vol1,334,188
Short Int17.60%

Current

Price$94.68
Market Cap$5.81B
Ollie's Bargain Outlet Holdings, Inc. is a holding company, which engages in the retail of closeouts, excess inventory, and salvage merchandise. It offers overstocks, package changes, manufacturer refurbished goods, and irregulars. The company's products include housewares, food, books and stationery, bed and bath, floor coverings, electronics and toys. Ollie's Bargain Outlet Holdings was founded by Mark Butler, Mort Bernstein, Oliver Rosenberg and Harry Coverman on July 29, 1982, and is headquartered in Harrisburg, PA.

Publicly traded companies mentioned herein: Big Lots Inc (BIG), Ollie’s Bargain Outlet Holdings Inc (OLLI)

Highlights

The presenter is long shares of Ollie’s Bargain Outlet Holdings Inc (OLLI), a closeout retailer that sells a broad array of household products for 30% – 70% lower than big box retailers, pharmacies, and convenience stores. Closeout retailers largely source inventory via excess units that higher priced retailers aren’t selling or distributors are changing the SKU size for. He expects the high inflationary environment and supply chain issues throughout the retail landscape to allow OLLI to buy up significant inventory for cents on the dollar and drive growth. The company currently has 431 stores and plans to open ~50 units per year; the unit growth story allowed the stock to trade north of 30x earnings until 2H’21 when poor performance caused a sell-off, and share prices have since fallen from $90 to the current $42. At current prices, OLLI is trading at 15x next year’s consensus EPS of $2.84, which he considers an attractive entry point for a company with a clean balance sheet ($246MM net cash position) that can grow topline DD%.

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Idea Discussion

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