Goldman Sachs Downgrades Ollie's Bargain Outlet To 'Sell'; UBS Begins With 'Neutral' Rating

Goldman Sachs analyst Kate McShane downgraded Ollie's Bargain Outlet Holdings Inc OLLI to Sell from Neutral with a price target of $48, down from $77, implying a 5.7% downside.
The analyst thinks opportunities for closeout inventory are likely to be more limited into 2022 as inventory challenges continue across retail.
This could result in more competitive costs, especially as retailers potentially expand assortment in order to obtain inventory, McShane notes.
She expects inventory uncertainty for Ollie's and believes the home category will likely underperform "given its more durable nature after elevated demand in 2020-2021."
UBS analyst Mark Carden initiated coverage of Ollie's Bargain Outlet with a Neutral rating and $55 price target, suggesting an 8% upside.
The analyst is positive about the company's deep discount offering and "treasure hunt experience," which allowed it to establish a "unique niche" appealing to a wide demographic and driving a "loyal" shopper base.
Meanwhile, Carden warns that Ollie's is facing challenges that have disrupted its previously steady growth amid supply chain issues are inventory challenges that are likely to persist "well into FY22".
Price Action: OLLI shares are trading higher by 0.87% at $50.91 on the last check Tuesday.

Analyst Calendar