
As the craze of earnings season draws to a close, here’s a look back at some of the most exciting (and some less so) results from Q3. Today, we are looking at discount retailer stocks, starting with Burlington (NYSE: BURL).
Discount retailers understand that many shoppers love a good deal, and they focus on providing excellent value to shoppers by selling general merchandise at major discounts. They can do this because of unique purchasing, procurement, and pricing strategies that involve scouring the market for trendy goods or buying excess inventory from manufacturers and other retailers. They then turn around and sell these snacks, paper towels, toys, clothes, and myriad other products at highly enticing prices. Despite the unique draw and lure of discounts, these discount retailers must also contend with the secular headwinds of online shopping and challenged retail foot traffic in places like suburban strip malls.
The 5 discount retailer stocks we track reported a strong Q3. As a group, revenues beat analysts’ consensus estimates by 1.9% while next quarter’s revenue guidance was 3.3% below.
Thankfully, share prices of the companies have been resilient as they are up 9.2% on average since the latest earnings results.
Burlington (NYSE: BURL)
Founded in 1972 as a discount coat and outerwear retailer, Burlington Stores (NYSE: BURL) is now an off-price retailer that has broadened into general apparel, footwear, and home goods.
Burlington reported revenues of $2.71 billion, up 7.1% year on year. This print was in line with analysts’ expectations, and overall, it was a satisfactory quarter for the company with a solid beat of analysts’ EBITDA estimates but revenue guidance for next quarter slightly missing analysts’ expectations.
Michael O’Sullivan, CEO, stated, “Total sales increased 7% in the third quarter, while comparable store sales increased 1%. Traffic to our stores fell off significantly after the back-to-school period driven by unseasonably warm temperatures in our major markets. Our comp trend then picked up to mid-single-digits in mid-October once the weather cooled, and that strong trend has continued through the first three weeks of November.”

Burlington delivered the weakest performance against analyst estimates and slowest revenue growth of the whole group. Interestingly, the stock is up 6.8% since reporting and currently trades at $303.69.
Is now the time to buy Burlington? Access our full analysis of the earnings results here, it’s free.
Best Q3: Five Below (NASDAQ: FIVE)
Often facilitating a treasure hunt shopping experience, Five Below (NASDAQ: FIVE) is an American discount retailer that sells a variety of products from mobile phone cases to candy to sports equipment for largely $5 or less.
Five Below reported revenues of $1.04 billion, up 23.1% year on year, outperforming analysts’ expectations by 6.3%. The business had a stunning quarter with EPS guidance for next quarter exceeding analysts’ expectations and a beat of analysts’ EPS estimates.

Five Below delivered the biggest analyst estimates beat and fastest revenue growth among its peers. The market seems happy with the results as the stock is up 16% since reporting. It currently trades at $190.87.
Is now the time to buy Five Below? Access our full analysis of the earnings results here, it’s free.
Weakest Q3: Ollie's (NASDAQ: OLLI)
Often located in suburban or semi-rural shopping centers, Ollie’s Bargain Outlet (NASDAQ: OLLI) is a discount retailer that acquires excess inventory then sells at meaningful discounts.
Ollie's reported revenues of $613.6 million, up 18.6% year on year, in line with analysts’ expectations. It was a mixed quarter as it posted a narrow beat of analysts’ EBITDA estimates but revenue in line with analysts’ estimates.
As expected, the stock is down 2.7% since the results and currently trades at $115.55.
Read our full analysis of Ollie’s results here.
Ross Stores (NASDAQ: ROST)
Selling excess inventory or overstocked items from other retailers, Ross Stores (NASDAQ: ROST) is an off-price concept that sells apparel and other goods at prices much lower than department stores.
Ross Stores reported revenues of $5.60 billion, up 10.4% year on year. This result topped analysts’ expectations by 2.6%. Overall, it was a very strong quarter as it also logged an impressive beat of analysts’ EBITDA estimates and a solid beat of analysts’ revenue estimates.
The stock is up 18.3% since reporting and currently trades at $189.86.
Read our full, actionable report on Ross Stores here, it’s free.
TJX (NYSE: TJX)
Initially based on a strategy of buying excess inventory from manufacturers or other retailers, TJX (NYSE: TJX) is an off-price retailer that sells brand-name apparel and other goods at prices much lower than department stores.
TJX reported revenues of $15.12 billion, up 7.5% year on year. This print beat analysts’ expectations by 1.5%. It was a strong quarter as it also produced an impressive beat of analysts’ EBITDA estimates and a solid beat of analysts’ gross margin estimates.
The stock is up 7.4% since reporting and currently trades at $156.42.
Read our full, actionable report on TJX here, it’s free.
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