Breaking Down Burlington Stores, Inc. (BURL) Financial Health: Key Insights for Investors

Are you keeping a close watch on Burlington Stores, Inc. (BURL) and wondering about its financial stability? With a market capitalization of $15.24 billion and an enterprise value of $19.61 billion, the company certainly grabs attention, but what do the numbers really tell us? In the fiscal year 2024, the company reported a total sales growth of 11% and a comparable store sales growth of 4%, resulting in a net income of $504 million, or $7.80 per diluted share. But how does its debt-to-equity ratio of 123% and free cash flow of -$7.28 million impact its overall health? Read on to discover key insights into BURL's financial metrics and what they mean for investors.

Burlington Stores, Inc. (BURL) Revenue Analysis

Understanding where Burlington Stores, Inc. (BURL) generates its revenue and how these streams have changed over time is crucial for investors. A detailed look into their revenue sources, growth rates, and segment contributions provides valuable insights into the company’s financial health.

Burlington Stores, Inc.'s primary revenue source is the sale of a wide array of products, including:

• Apparel
• Footwear
• Accessories
• Home goods
• Other merchandise

These products are offered at significant discounts compared to traditional retail prices.

Analyzing Burlington Stores, Inc.'s year-over-year revenue growth rate reveals important trends. For example, net sales for fiscal year 2023, which ended on February 3, 2024, increased by 12.5% compared to fiscal year 2022. Total sales reached approximately $9.7 billion in 2023, up from about $8.6 billion the previous year.

Here is a breakdown of Burlington Stores, Inc.'s revenue performance:

• Total revenue for fiscal year 2023: $9.7 billion (approximate)
• Increase from fiscal year 2022: 12.5%

As of the third quarter of 2024, Burlington Stores Inc. reported a total revenue of $2.3 billion, reflecting a notable increase of 13.2% compared to the $2.0 billion recorded in the third quarter of 2023.

To provide a clearer picture, the following table summarizes Burlington Stores, Inc.'s recent revenue data:

Burlington Stores, Inc. operates primarily through its retail segment, encompassing all its stores. Therefore, the majority of its revenue comes from this segment. There are no significantly diverse business segments to analyze separately.

Significant changes in Burlington Stores, Inc.'s revenue streams include strategic initiatives such as:

• Expanding store count
• Improving inventory management
• Enhancing the customer experience

These efforts are aimed at driving sales growth and increasing profitability. For instance, in fiscal year 2023, Burlington Stores, Inc. opened 66 new stores while relocating or closing 14, resulting in a net increase of 52 stores.

Learn more about the investors of Burlington Stores, Inc.: Exploring Burlington Stores, Inc. (BURL) Investor Profile: Who’s Buying and Why?

Burlington Stores, Inc. (BURL) Profitability Metrics

Profitability is a critical indicator of a company's financial health, revealing how efficiently it generates earnings from its revenue. For investors and analysts, understanding the nuances of gross profit, operating profit, and net profit margins provides valuable insights into Burlington Stores, Inc.'s (BURL) performance and sustainability.

Let's explore Burlington Stores, Inc.'s (BURL) profitability metrics:

• Gross Profit: Gross profit is calculated by deducting the cost of goods sold (COGS) from the company’s revenue. It indicates how efficiently a company manages its production costs.
• Operating Profit: Operating profit is earnings before interest and taxes (EBIT). It is derived by deducting operating expenses such as salaries, rent, and depreciation from the gross profit. Operating profit is a key metric of a company's profitability from its core business operations.
• Net Profit: Net profit, often referred to as the bottom line, is what remains after all expenses, including interest, taxes, and other one-time charges, have been deducted from revenue. The net profit margin is calculated by dividing net profit by total revenue, providing a percentage that represents the profit a company earns for each dollar of revenue.

Analyzing these metrics over time helps to identify trends and potential issues. For instance, a declining gross margin could indicate rising production costs, while a decreasing net profit margin might suggest problems with cost control or increased competition.

Here is the data available for Burlington Stores, Inc. (BURL) based on the 2024 fiscal year:

In fiscal year 2024, Burlington Stores, Inc. reported the following:

• Total revenue increased by 12.5% to $10.167 billion.
• Gross profit increased to $4.349 billion, and the gross margin improved to 42.8%.
• The company's operating income was $871 million, or 8.6% of sales.
• Net income totaled $601 million, or $9.16 per share. Adjusted net income was $618 million, or $9.42 per share.

Burlington Stores, Inc. has shown consistent improvement in its financial performance, particularly in revenue growth and margin expansion. The increase in total revenue by 12.5% to $10.167 billion indicates strong sales performance. The gross margin improved to 42.8%, reflecting efficient cost management and pricing strategies. The operating income reached $871 million, or 8.6% of sales, demonstrating the company's ability to manage operating expenses effectively.

A comparison with industry averages provides context for evaluating Burlington Stores, Inc.'s (BURL) profitability. If its gross and net profit margins are higher than the industry average, it suggests a competitive advantage. Conversely, lower margins might indicate areas needing improvement.

Operational efficiency is vital for maintaining and improving profitability. Key aspects to consider include:

• Cost Management: Efficiently managing expenses such as supply chain costs, labor, and marketing can significantly impact profitability.
• Gross Margin Trends: Monitoring gross margin trends helps identify issues such as rising production costs or pricing inefficiencies.
• Inventory Turnover: A high inventory turnover ratio indicates efficient inventory management, reducing holding costs and the risk of obsolescence.

Here's a look at some key financial data for Burlington Stores, Inc. (BURL):

Understanding these profitability metrics and their trends is essential for investors and analysts. It allows for a comprehensive assessment of a company's financial health and its ability to generate sustainable profits.

Read more about the company: Exploring Burlington Stores, Inc. (BURL) Investor Profile: Who’s Buying and Why?

Burlington Stores, Inc. (BURL) Debt vs. Equity Structure

Understanding how Burlington Stores, Inc. (BURL) finances its operations and growth is crucial for investors. The balance between debt and equity can reveal a lot about the company's financial strategy, risk profile, and long-term sustainability. Here's a breakdown of Burlington Stores' debt and equity structure.

As of the end of fiscal year 2024, Burlington Stores maintains a mix of debt and equity to fund its operations and expansion. Analyzing the specifics of their debt levels provides insights into their financial leverage.

Overview of Debt Levels:

• Long-Term Debt: As of the end of fiscal year 2024, Burlington Stores had approximately $2.03 billion in long-term debt.
• Short-Term Debt: The company's short-term debt obligations totaled around $28.6 million at the close of fiscal year 2024.

The debt-to-equity ratio is a key metric for assessing a company's financial leverage. It indicates the proportion of debt and equity used to finance the company's assets. For Burlington Stores, this ratio provides insight into their financial risk relative to industry peers.

Debt-to-Equity Ratio:

For the fiscal year 2024, Burlington Stores' debt-to-equity ratio was approximately 1.66. This ratio is calculated by dividing the total liabilities by shareholders equity. A ratio of 1.66 indicates that Burlington Stores uses $1.66 of debt for every $1 of equity.

To provide context, here’s a comparison of Burlington Stores' debt-to-equity ratio with that of its industry peers:

Keeping track of any recent debt issuances, credit ratings, or refinancing activities helps in understanding the company's approach to managing its debt.

• In March 2024, Burlington Stores successfully refinanced its existing term loan facility. The new $750 million term loan matures in March 2029.
• As of December 2024, Burlington Stores' credit ratings were affirmed by both Moody's and Standard & Poor's, reflecting a stable outlook.

Balancing debt and equity is essential for sustainable growth. Too much debt can increase financial risk, while too little debt might indicate a missed opportunity to leverage growth. Burlington Stores strategically manages this balance to optimize its financial performance.

Balancing Act: Debt Financing vs. Equity Funding:

Burlington Stores strategically uses debt financing to fund expansion and operational improvements, while equity funding supports long-term stability and growth initiatives. This balanced approach enables the company to maintain financial flexibility and capitalize on growth opportunities.

To delve deeper into the values that drive Burlington Stores, Inc. (BURL), explore: Mission Statement, Vision, & Core Values of Burlington Stores, Inc. (BURL).

Burlington Stores, Inc. (BURL) Liquidity and Solvency

Liquidity and solvency are critical indicators of a company's financial health, revealing its ability to meet short-term obligations and sustain long-term operations. For Burlington Stores, Inc. (BURL), assessing these metrics provides valuable insights into its financial stability and operational efficiency.

Current and Quick Ratios: These ratios are fundamental in evaluating a company's liquidity position. The current ratio, calculated as current assets divided by current liabilities, indicates whether a company has enough short-term assets to cover its short-term liabilities. For the fiscal year 2024, Burlington Stores, Inc. (BURL) reported a current ratio of 1.68. A ratio above 1 generally suggests good liquidity. The quick ratio, which excludes inventory from current assets (as inventory may not be easily converted to cash), provides a more conservative view. Burlington Stores, Inc. (BURL)'s quick ratio for 2024 was 0.63. This lower quick ratio compared to the current ratio suggests that the company relies on inventory to meet its short-term liabilities.

Working Capital Trends: Monitoring working capital trends—the difference between current assets and current liabilities—offers insights into how efficiently a company manages its short-term resources. As of February 3, 2024, Burlington Stores, Inc. (BURL) reported working capital of $578 million, compared to $448 million as of January 28, 2023. This increase in working capital indicates improved short-term financial health, reflecting better management of current assets and liabilities.

Cash Flow Statements Overview: Analyzing cash flow statements provides a comprehensive view of a company's liquidity. These statements are divided into three main sections:

• Operating Activities: Cash flow from operating activities reflects the cash generated from the company’s core business operations. For the fiscal year 2024, Burlington Stores, Inc. (BURL) reported net cash from operating activities of $639 million.
• Investing Activities: This section includes cash flow from the purchase and sale of long-term assets. In 2024, Burlington Stores, Inc. (BURL) had net cash used for investing activities of $218 million.
• Financing Activities: Cash flow from financing activities involves transactions related to debt, equity, and dividends. Burlington Stores, Inc. (BURL) reported net cash used for financing activities of $371 million in 2024.

The positive cash flow from operating activities indicates that Burlington Stores, Inc. (BURL) is generating sufficient cash from its business to cover its operational needs. The use of cash in investing activities suggests ongoing investments in the company’s infrastructure and long-term growth. The cash used in financing activities primarily reflects debt repayments and other financing-related expenses.

Potential Liquidity Concerns and Strengths:

While Burlington Stores, Inc. (BURL) exhibits several strengths in its liquidity position, there are also areas that warrant attention:

• Strengths:
  • A current ratio of 1.68 indicates a solid ability to cover short-term liabilities with current assets.
  • Positive cash flow from operating activities demonstrates strong cash generation from core business operations.
  • An increase in working capital from $448 million in 2023 to $578 million in 2024 suggests improved short-term financial management.
• Concerns:
  • A quick ratio of 0.63 suggests a reliance on inventory to meet short-term obligations, which could be a concern if inventory turnover slows down.
  • Consistent use of cash in financing activities may indicate a need to manage debt and financing costs effectively.

In summary, Burlington Stores, Inc. (BURL) demonstrates a generally healthy liquidity position, supported by strong operating cash flow and an increasing working capital. However, the lower quick ratio and consistent cash outflows from financing activities suggest areas where careful financial management is essential.

For more insights into Burlington Stores, Inc. (BURL) investor profile, check out: Exploring Burlington Stores, Inc. (BURL) Investor Profile: Who’s Buying and Why?

Burlington Stores, Inc. (BURL) Valuation Analysis

Assessing whether Burlington Stores, Inc. (BURL) is overvalued or undervalued requires a multifaceted approach, incorporating key financial ratios, stock performance analysis, and analyst sentiment. Let's delve into these aspects to provide a clearer picture for investors.

To determine if Burlington Stores, Inc. (BURL) is correctly valued, several key ratios are essential:

• Price-to-Earnings (P/E) Ratio: This ratio indicates how much investors are willing to pay for each dollar of earnings. A higher P/E ratio might suggest overvaluation, while a lower one could indicate undervaluation, relative to peers and historical averages.
• Price-to-Book (P/B) Ratio: The P/B ratio compares a company's market capitalization to its book value of equity. It can help identify if the stock price is trading at a premium or discount to its net asset value.
• Enterprise Value-to-EBITDA (EV/EBITDA): This ratio provides a more comprehensive valuation measure by considering both debt and equity, assessing the company's total value relative to its earnings before interest, taxes, depreciation, and amortization.

Analyzing Burlington Stores, Inc. (BURL)’s stock price trends over the past year offers insights into market sentiment and company performance. Significant price appreciation could suggest growing investor confidence, while a decline might indicate concerns about the company's future prospects. Keep an eye on the Mission Statement, Vision, & Core Values of Burlington Stores, Inc. (BURL).

As of April 21, 2025, Burlington Stores, Inc. does not offer dividends. Therefore, dividend yield and payout ratios are not applicable in this valuation analysis.

Here's a look at potential analyst perspectives:

Keep in mind that analyst ratings can influence investor perception, but they should be considered alongside other valuation metrics and your own due diligence.

Burlington Stores, Inc. (BURL) Risk Factors

Several factors could potentially impact Burlington Stores, Inc.'s (BURL) financial health, encompassing both internal and external risks. These risks include industry competition, regulatory changes, and overall market conditions. Breaking Down Burlington Stores, Inc. (BURL) Financial Health: Key Insights for Investors

Here's a breakdown of key risk areas:

• Industry Competition: The retail sector is highly competitive. Burlington faces competition from other discount retailers, department stores, and online marketplaces. Intense competition could lead to price wars, reduced profit margins, and loss of market share.
• Economic Conditions: Burlington's performance is closely tied to the overall economic climate. Economic downturns, rising unemployment, or decreased consumer confidence could negatively impact consumer spending and reduce sales.
• Inventory Management: As an off-price retailer, effective inventory management is crucial. Burlington needs to accurately forecast demand, manage markdowns, and avoid excessive inventory buildup, which can lead to lower profitability.
• Supply Chain Disruptions: Disruptions in the global supply chain, such as port delays, factory closures, or transportation bottlenecks, can impact Burlington's ability to source merchandise and fulfill customer orders, potentially leading to lost sales and increased costs.
• Data Security: Maintaining the security of customer and company data is critical. Data breaches or cyberattacks could result in financial losses, reputational damage, and legal liabilities.
• Labor Costs and Availability: Rising labor costs and a tight labor market could put pressure on Burlington's operating expenses. Attracting and retaining qualified employees is essential for maintaining store operations and customer service levels.

Mitigation strategies or plans are often detailed in the company’s filings with the Securities and Exchange Commission (SEC), such as the 10-K report. Investors should review these documents for a comprehensive understanding of Burlington's risk management approach.

Burlington Stores, Inc. (BURL) Growth Opportunities

Burlington Stores, Inc. (BURL) has several key growth drivers that suggest promising future growth prospects. These include strategic initiatives focused on product innovation, market expansion, and leveraging competitive advantages.

Here’s an analysis of these factors:

• Product Innovations: Burlington focuses on offering a wide assortment of in-season, fashion-forward merchandise at great value. This strategy attracts a broad customer base and drives repeat visits.
• Market Expansion: A significant component of Burlington’s growth strategy involves expanding its store footprint. As of fiscal year 2024, the company operated 956 stores and sees potential to grow to 2,000 stores nationwide. This expansion is aimed at increasing market penetration and brand visibility.
• Acquisitions: While not always a primary growth driver, strategic acquisitions can enhance Burlington’s market position and capabilities. However, there have been no significant acquisitions as of late 2024.

Future revenue growth projections and earnings estimates for Burlington Stores, Inc. (BURL) indicate a positive trajectory. Analysts predict consistent revenue growth driven by store expansion and comparable store sales increases. Earnings are expected to grow as the company leverages its scale and improves operational efficiencies.

Strategic initiatives and partnerships that may drive future growth include:

• Real Estate Strategy: Burlington focuses on opening stores in off-mall locations, which tend to have lower occupancy costs and higher traffic.
• Supply Chain Improvements: Investments in supply chain infrastructure and technology are aimed at reducing costs and improving inventory management.
• Marketing and Loyalty Programs: Enhancing marketing efforts and loyalty programs to drive customer engagement and repeat purchases.

Burlington holds several competitive advantages that position it for sustained growth:

• Value Proposition: Burlington offers a compelling value proposition to customers by providing brand-name merchandise at discounted prices.
• Flexible Business Model: The company's off-price retail model allows it to adapt quickly to changing consumer preferences and market trends.
• Strong Financial Position: Burlington maintains a healthy balance sheet and generates strong cash flow, providing financial flexibility to invest in growth initiatives.

For fiscal year 2024, Burlington Stores, Inc. (BURL) reported:

These figures reflect Burlington’s robust financial performance and its ability to generate profitable growth.

Learn more about Burlington Stores, Inc. (BURL) investors: Exploring Burlington Stores, Inc. (BURL) Investor Profile: Who’s Buying and Why?