Burlington
BURL
$313.18
-0.57%
Burlington Stores, Inc. is an off-price retailer offering a broad selection of in-season, fashion-focused merchandise including apparel, footwear, accessories, home goods, and coats. As a leading off-price retailer, Burlington competes with TJX Companies and Ross Stores by offering branded merchandise at discounted prices, leveraging a treasure-hunt shopping experience. The current investor narrative centers on Burlington's ability to sustain growth momentum amid a challenging retail environment, with recent earnings beats and raised guidance highlighting operational strength, though sky-high expectations have tempered stock performance. The company's focus on expanding its store base and improving margins is driving debate around its long-term growth trajectory.…
BURL
Burlington
$313.18
Related headlines
Investment Opinion: Should I buy BURL Today?
Rating: Buy. Thesis: Burlington's accelerating revenue growth (11.5% YoY), expanding margins (net margin 8.51% in Q4), and reasonable forward P/E of 22.71x (below 5-year average of ~50x) make it an attractive growth-at-a-reasonable-price (GARP) opportunity. Analyst consensus is bullish with all 3 analysts rating Outperform, and the implied target of ~$373 offers 19% upside.
Supporting Evidence: 1) Revenue growth accelerated to 11.5% YoY in Q4, the highest in the past year. 2) Forward P/E of 22.71x is below the 5-year average of ~50x and only a 41% premium to the sector median of ~22x, justified by superior growth. 3) Net margin improved to 8.51% in Q4 from 7.97% a year ago, and ROE is 33.76%, well above industry averages. 4) Free cash flow TTM is $231.7 million, supporting reinvestment. The analyst-implied target of ~$373 (based on forward EPS of $16.42 and P/E of 22.71x) suggests 19% upside.
Risks & Conditions: The biggest risks are a deceleration in revenue growth below 10%, which could compress the P/E multiple, and a rise in interest rates that increases debt costs. If the forward P/E compresses below 20x (sector median), the stock would be a strong buy; if growth falls below 8%, downgrade to Hold. Overall, Burlington appears fairly valued relative to its growth rate, with a PEG ratio of 1.54, suggesting it is not overvalued.
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BURL 12-Month Price Forecast
Burlington's fundamentals are strong with accelerating revenue, improving margins, and a reasonable valuation relative to its history. The forward P/E of 22.71x is well below the 5-year average, suggesting the market is not fully pricing in the growth potential. However, the stock's recent price weakness and high expectations warrant caution. The base case of 8-10% growth and stable margins is most likely, but the bull case has a non-trivial probability if execution continues. I would upgrade to a more bullish stance if revenue growth exceeds 12% in the next quarter, and downgrade to neutral if growth falls below 8% or margins contract.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Burlington's 12-month outlook, with a consensus price target around $407.13 and implied upside of +30.0% versus the current price.
Average Target
$407.13
3 analysts
Implied Upside
+30.0%
vs. current price
Analyst Count
3
covering this stock
Price Range
$251 - $407
Analyst target range
Burlington is covered by 3 analysts, with a consensus recommendation leaning bullish. The average EPS estimate for the next fiscal year is $16.42, with a low of $16.15 and high of $16.76. The average revenue estimate is $15.54 billion, with a range of $15.34B to $15.79B. While specific price targets are not provided, the consensus implies upside based on the forward P/E of 22.71x and estimated EPS of $16.42, suggesting a target price around $373 (22.71 * 16.42), implying approximately +19% upside from the current price of $313.18. The institutional ratings show consistent bullishness, with firms like Telsey Advisory Group, Baird, Wells Fargo, Citigroup, JP Morgan, and Barclays all maintaining Outperform or Overweight ratings. The most recent actions (March 2026) reaffirm these ratings, indicating strong conviction. The lack of a wide target spread suggests relatively low uncertainty among analysts, though the small number of analysts (3) means coverage is limited, which can lead to higher volatility and less efficient price discovery.
Bulls vs Bears: BURL Investment Factors
Burlington presents a compelling growth story with accelerating revenue (11.5% YoY), strong margins (net margin 8.51%), and a forward P/E of 22.71x that is below its historical average. The bull case is supported by analyst consensus (all Outperform) and implied 19% upside to ~$373. However, the stock trades at a 41% premium to the sector median P/E, has a high debt-to-equity of 3.32, and recent price momentum is negative. The key tension is whether Burlington can sustain its growth trajectory to justify its premium valuation. If revenue growth decelerates or margins compress, the stock could face multiple compression. Conversely, continued strong execution could drive the stock higher. Currently, the bull case has slightly stronger evidence given the growth acceleration and reasonable forward multiple, but the risk of high expectations is significant.
Bullish
- Strong Revenue Growth Acceleration: Burlington's Q4 FY2025 revenue grew 11.47% YoY to $3.647 billion, accelerating from 7.1% in Q3 and 9.7% in Q2. This consistent acceleration demonstrates strong execution and market share gains in the off-price retail sector.
- Significant Forward P/E Compression: The trailing P/E of 31.11x is well below the 5-year average of ~50x, and the forward P/E of 22.71x implies 27% earnings growth is expected. If realized, the stock could see multiple expansion, offering upside to the analyst-implied target of ~$373 (19% upside).
- Robust Profitability and Margins: Net margin improved to 8.51% in Q4 FY2025 (vs. 7.97% a year ago), and ROE stands at 33.76%, well above the retail industry average. Operating margin of 11.28% in Q4 demonstrates pricing power and cost discipline.
- Strong Analyst Consensus and Upside: All 3 analysts rate the stock as Outperform/Overweight, with an average EPS estimate of $16.42 for next fiscal year. The implied target of ~$373 (based on forward P/E of 22.71x) offers 19% upside from the current price of $313.18.
Bearish
- High Valuation vs. Industry Peers: Burlington's trailing P/E of 31.11x is a 41% premium to the apparel retail sector median of ~22x. While growth justifies some premium, any deceleration could lead to multiple compression and significant downside.
- Elevated Debt-to-Equity Ratio: Debt-to-equity of 3.32 is high, even for retail, indicating significant leverage. Interest expense of $18.7 million in Q4 (up from $18.5M a year ago) eats into earnings, and rising rates could pressure margins.
- Recent Price Momentum Weakening: The stock is down 2.46% in the past month and 4.73% in the past three months, underperforming the S&P 500 by 1.2% and 18.3% respectively. This suggests fading momentum and potential profit-taking after a strong run.
- Sky-High Expectations Risk: Recent news highlights that Burlington beat earnings estimates but disappointed investor expectations, causing a sell-off. The stock trades near the top of its 52-week range (89th percentile), leaving little room for error.
BURL Technical Analysis
Burlington's stock is in a sustained uptrend over the past year, with a 1-year price change of +29.26%. The current price of $313.18 sits at 89% of its 52-week range ($240.49 to $351.85), indicating the stock is trading near the upper end of its range, reflecting strong momentum but also potential overextension. The stock's beta of 1.46 suggests it is 46% more volatile than the market, amplifying both upside and downside moves. Short-term momentum shows a divergence: the 1-month change is -2.46% while the 3-month change is -4.73%, indicating a recent pullback from the April highs. This deceleration contrasts with the strong 1-year uptrend, suggesting a potential mean-reversion or consolidation phase. The 6-month change of +4.96% confirms the longer-term uptrend remains intact, but the recent weakness warrants caution. Key support lies at the 52-week low of $240.49, while resistance is at the 52-week high of $351.85. A breakout above $351.85 would signal a resumption of the uptrend, while a breakdown below $240.49 could indicate a trend reversal. With a beta of 1.46, the stock is more volatile than the S&P 500, meaning larger swings in both directions, which is important for risk management.
Beta
1.46
1.46x market volatility
Max Drawdown
-19.6%
Largest decline past year
52-Week Range
$240-$352
Price range past year
Annual Return
+29.3%
Cumulative gain past year
| Period | BURL Return | S&P 500 |
|---|---|---|
| 1m | -2.5% | +1.0% |
| 3m | -4.7% | +13.0% |
| 6m | +5.0% | +7.7% |
| 1y | +29.3% | +19.1% |
| ytd | +5.0% | +9.2% |
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BURL Fundamental Analysis
Burlington's revenue trajectory is solidly growing, with the most recent quarterly revenue (Q4 FY2025, ending Jan 31, 2026) of $3.647 billion, up 11.47% year-over-year. This marks an acceleration from the prior quarter's revenue of $2.710 billion (Q3 FY2025) and the year-ago quarter's $3.272 billion. The multi-quarter trend shows consistent growth, with Q1 through Q4 FY2025 revenues of $2.503B, $2.704B, $2.710B, and $3.647B, respectively, indicating a strong holiday quarter. The company's off-price model is driving growth through store expansion and comparable store sales increases. Profitability is solid, with net income of $310.4 million in Q4 FY2025, up from $260.8 million in the year-ago quarter. Gross margin improved to 40.11% from 42.90% a year ago, reflecting a slight compression but still healthy. Operating margin was 11.28% in Q4, up from 12.70% a year ago, indicating stable profitability. The company is profitable with a net margin of 8.51% in Q4, and the trailing twelve-month net margin is 5.27%. The balance sheet shows a debt-to-equity ratio of 3.32, which is high but typical for retail, and a current ratio of 1.23, indicating adequate liquidity. Free cash flow for the trailing twelve months is $231.7 million, though Q4 showed negative free cash flow of -$62.1 million due to heavy capital expenditures. ROE is strong at 33.76%, reflecting efficient use of equity, while ROA is 6.09%. The company generates sufficient operating cash flow ($937.5 million in Q4) to fund investments, though capital expenditures are significant.
Quarterly Revenue
$3.6B
2026-01
Revenue YoY Growth
+0.11%
YoY Comparison
Gross Margin
+0.40%
Latest Quarter
Free Cash Flow
$231745000.0B
Last 12 Months
Revenue & Net Income Trends (2 Years)
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Valuation Analysis: Is BURL Overvalued?
Since net income is positive, the primary valuation metric is the P/E ratio. The trailing P/E is 31.11x, while the forward P/E is 22.71x, implying the market expects earnings growth to reduce the multiple. The gap between trailing and forward P/E suggests analysts anticipate significant earnings growth in the coming year. Compared to the industry average (Apparel - Retail), Burlington's trailing P/E of 31.11x is at a premium to the sector median of approximately 22x (based on industry data), representing a 41% premium. This premium is justified by Burlington's superior revenue growth (11.5% YoY) and strong profitability (net margin 5.27% vs. industry average ~3-4%). Historically, Burlington's trailing P/E has ranged from 13.4x to 208.5x over the past five years, with the current 31.11x near the lower end of its historical range, suggesting the stock is not overvalued relative to its own history. The current P/E is below the 5-year average of ~50x, indicating potential value if earnings growth materializes.
PE
31.1x
Latest Quarter
vs. Historical
Low-End
5-Year PE Range 13x~338x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
18.2x
Enterprise Value Multiple
Investment Risk Disclosure
Financial & Operational Risks: Burlington's high debt-to-equity ratio of 3.32 is a key financial risk, as interest expense of $18.7 million in Q4 (stable YoY) could rise if rates increase. The company's net margin of 5.27% TTM is solid but could be pressured by rising costs or promotional activity. Free cash flow of $231.7 million TTM is positive, but Q4 showed negative FCF of -$62.1 million due to heavy capex, which could strain liquidity if growth slows. Revenue concentration in discretionary apparel makes the company sensitive to consumer spending shifts, and any economic downturn could impact sales.
Market & Competitive Risks: Burlington's trailing P/E of 31.11x is a 41% premium to the industry median, making it vulnerable to valuation compression if growth disappoints. The stock's beta of 1.46 implies 46% higher volatility than the market, amplifying downside in a sell-off. Competition from TJX and Ross Stores is intense, and any loss of market share could hurt growth. The recent news highlights that investor expectations are sky-high, so even a beat may not satisfy the market, as seen in the post-earnings sell-off.
Worst-Case Scenario: A recession could cause consumers to trade down, but off-price retailers like Burlington typically benefit. However, if Burlington's execution falters—e.g., same-store sales miss, margins compress due to inventory issues—the stock could fall to its 52-week low of $240.49, representing a 23% decline from the current price of $313.18. In a severe downturn, a multiple contraction to 20x forward earnings (sector median) would imply a price of ~$328, but if earnings also fall, the downside could be larger. Historically, the stock's max drawdown is -19.55%, so a 20-25% decline is plausible in a bear case.
FAQ
The key risks are: 1) Financial risk: high debt-to-equity of 3.32 could strain earnings if interest rates rise. 2) Valuation risk: the stock's P/E premium to peers (41% above sector median) leaves it vulnerable to multiple compression if growth disappoints. 3) Competitive risk: intense competition from TJX and Ross Stores could pressure market share and margins. 4) Macro risk: as a discretionary retailer, Burlington is sensitive to consumer spending; a recession could hurt sales. The most severe risk is a growth deceleration below 5%, which could trigger a de-rating to 20x forward P/E, implying a 20%+ downside from current levels.
The 12-month forecast is based on three scenarios. The base case (50% probability) sees revenue growth moderating to 8-10%, with the stock trading around $310-$350, near the analyst average target. The bull case (30% probability) assumes sustained 10%+ growth and multiple expansion to 25x forward P/E, pushing the price to $350-$380. The bear case (20% probability) involves a consumer slowdown causing growth below 5% and multiple compression to 18x, leading to a price of $240-$290. The most likely scenario is the base case, with the stock offering modest upside from current levels. Key assumptions include stable margins and no major macro shocks.
Burlington's trailing P/E of 31.11x is a 41% premium to the apparel retail sector median of ~22x, suggesting it is overvalued relative to peers. However, the forward P/E of 22.71x is below the 5-year average of ~50x, indicating the stock is undervalued relative to its own history. The PEG ratio of 1.54 suggests the stock is fairly valued given its expected earnings growth of 27% (implied by the forward P/E). The market is pricing in strong growth, but if Burlington delivers, the current valuation is reasonable. Overall, the stock appears fairly valued to slightly undervalued based on forward earnings, but it is not a deep value play.
Burlington is a good buy for growth-oriented investors with a moderate risk tolerance. The stock offers 19% upside to the analyst-implied target of ~$373, supported by accelerating revenue growth (11.5% YoY) and a forward P/E of 22.71x that is below its 5-year average of 50x. However, the stock trades at a 41% premium to the sector median P/E, and recent price momentum is negative, so it is not without risk. The biggest downside is a potential deceleration in growth that could compress the multiple. For investors who believe Burlington can sustain 10%+ revenue growth, the current price offers an attractive entry point. For those seeking lower risk, waiting for a pullback closer to $290 (the 52-week low) may provide a better margin of safety.
Burlington is better suited for long-term investment (3-5 years) given its growth trajectory and reasonable valuation. The stock's beta of 1.46 makes it more volatile than the market, so short-term trading carries higher risk. The company does not pay a dividend, so returns come from price appreciation. With a forward P/E of 22.71x and expected earnings growth of 27%, the stock offers a favorable risk/reward for long-term holders who can tolerate volatility. Short-term traders may find opportunities around earnings events, but the recent negative momentum suggests caution. A minimum holding period of 12 months is recommended to allow the growth story to play out.