PNC Financial Services Group Inc. has recently announced that it has lowered its stake in shares of Burlington Stores, Inc. by 10.5% during the 4th quarter after selling 6,055 shares as the company filed a Form 13F with the Securities and Exchange Commission (SEC). This move has taken the financial world by surprise and led to some raised eyebrows from analysts.
Burlington Stores, Inc is known for selling off-price apparel and home products. It offers diverse categories of products including women’s wear, footwear, menswear, youth apparel, baby clothes, beauty products, toys and gifts, and many others. The company operates through multiple segments including Ladies Apparel, Accessories and Shoes; Home; Mens Apparel; Kids Apparel and Baby; and Outerwear.
It comes as shocking news that CMO Jennifer Vecchio sold 47,153 shares of Burlington Stores’ stock in a transaction worth around $9 million on March 17th. Following this sale, Vecchio’s remaining shares are valued at $11 million. Similarly, William P. McNamara also sold 500 shares at an average price of $212.26 on March 21st which was disclosed in a filing with SEC.
Despite these high-profile sales by top executives from within Burlington likely triggered market watchers looking for underlying reasons that would have caused such moves both inside itself or PNC Financial Service Group which reportedly had owned .08% interests in Burlington worth about $10 million prior to the sale.
As corporate insiders own somewhere around .71% equity stakes at Burlington Stores observations should not be seen as signs of a decline in the firm’s health & bankability rather perhaps simply part of routine corrective accounting movements taking place. Investors await official statements from all parties involved for complete transparency over who was involved & why their assets were moved when they were, without warning or explanation thus far being tendered to explain abruptness associated with recent sales action.
Burlington Stores: Investor Interest, Positive Ratings and Steady Growth
Burlington Stores: An Overview of Recent Activities
Investors have modified their holdings of Burlington Stores recently, with institutional investors and hedge funds taking an interest in the company. Mitsubishi UFJ Trust & Banking Corp increased its position in the firm by 6.1% at the end of 2016; it now has shares worth $7,860,000 after purchasing an additional 2,234 shares during the last quarter. Meanwhile, Vanguard Personalized Indexing Management LLC boosted its stake in Burlington Stores by over a hundred per cent in early 2017 to own shares worth just over $1,400,000. The trend continued throughout the fourth quarter as other hedge funds such as Commerce Bank also decided to invest more heavily into Burlington Stores.
Several research firms have commented on BURL’s activity recently. OTR Global gave the retailer a positive rating recently and suggested that this was a step up from its previous “mixed” rating. Telsey Advisory Group has indicated that it is confident that Burlington Stores is set for success and even provided a price target of $250.00 per share back in March.
However, not all analysts are optimistic about the potential performance of Burlington Stores’ stock (NYSE:BURL). UBS Group downgraded BURL recently from a neutral rating to a sell rating while StockNews.com initiated coverage on the stock last month and set a “hold” rating on it.
Despite these setbacks, most analysts still praise Burlington Stores for their successful retail model selling off-price apparel and home products. Their sales rose steadily during Q1 2017 beating both expected EPS (Earnings Per Share) at $2.96 compared to predicted EPS of $2.72. Plus they hit revenue targets of just over $2 billion compared with estimates of approximately $700 million less than that at $1.3 billion which was predicted by some for the year’s first fiscal quarter.
In terms of shareholder value, BURL’s shares have performed well in recent years. The company’s 52 week low was $106.47 and the high was $239.94 with a current stock price of $161.74 at market open on June 21st, 2017. According to Bloomberg.com data, it has a consensus rating of “Moderate Buy” and its consensus price target is currently set at $225.94.
Overall, Burlington Stores’ recent activities have been promising for shareholders, with some investors increasing their stakes in the firm and several research firms praising its retail model and performance. Although not all analysts give it positive ratings or predictions, most are optimistic about Burlington’s prospects in the coming years.
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