Brian Sozzi Reiterates Buy On BJ's Wholesale Club Inc. (BJ)

Brian Sozzi of Wall Street Strategies is reiterating its Buy rating and $53 price target on shares of BJ's Wholesale Club Inc. BJ. In a note sent to clients, Sozzi writes, "BJ's Wholesale Club (BJ) is out with a flurry of news this morning. In the aggregate, the personnel shakeup in the executive ranks and the announcement of five club closures while overdue actions, is unlikely to maintain BJ's as a public entity if it were so inclined. We think the timing and type of announcements are strategic in nature, coming ahead of an alleged auction of the company later this month. Management is trying to portray itself as having the ability to make the difficult decisions required to drive stronger earnings growth perhaps to stay aboard under a new regime, while also displaying hidden value to would be bidders. The closure of five clubs and the reorganization of headquarters staff have the potential to lift EPS by $0.05 to $0.10 in FY11 according to our model, but we fancy the actual accretion will be less as savings are reinvested in new clubs, remodels, and IT." Shares of BJ closed at $47.00.