Ollie's Bargain Outlet Holdings, Inc.

What they do

Ollie's sells brand name household products at prices up to 70% below traditional retailers through a flexible, opportunistic buying model focused on closeout merchandise and excess inventory. The company operates one reportable segment with a no-frills, warehouse-style 'treasure hunt' store format. As of January 31, 2026, it operated 645 stores in 34 states; by May 2, 2026, it had 672 stores in 35 states.

Revenue drivers

• Retail stores — All net sales come from retail stores; revenue growth is driven primarily by new store openings, with comparable store sales contributing smaller gains (1.7% in Q1 2026).
• Comparable store sales — Measures sales from stores open at least 15 full fiscal months; Q1 2026 comps rose 1.7% driven mainly by increased basket size.
• New store openings — Opened 27 stores in Q1 2026 (25 in Q1 2025); store count grew 15.1% year-over-year, and store openings remain the largest driver of net sales and profitability growth.

Recent performance

For the first quarter ended May 2, 2026, net sales increased 14.2% to $658.9 million from $576.8 million in the prior-year quarter. Net income rose 18.6% to $56.4 million, and diluted EPS increased 19.5% to $0.92. Adjusted diluted EPS increased 21.3% to $0.91. Gross margin expanded 80 basis points to 41.9%, and SG&A as a percentage of net sales was flat at 28.6%. The company ended the quarter with $525.6 million in total cash and investments.

Strategy

Management's principal growth strategy is opening new stores, combining organic openings with acquisitions of bankrupt retailers' locations, following a contiguous expansion pattern. The company is investing in the supply chain and category productivity initiatives, and growing its Ollie's Army loyalty membership base. In Q1 2026, it repurchased $53.4 million of stock, with $205.4 million remaining under its share repurchase authorization. Management raised its fiscal 2026 EPS outlook based on the strong start to the year.

Risks

• Opportunistic buying execution — Failure to source closeout inventory at favorable prices or manage inventory in response to consumer demand could hurt sales and margins.
• Comparable store sales volatility — Comparable store sales have fluctuated in the past and may decline substantially on a quarterly basis, negatively impacting financial results.
• Supply chain disruption — Loss or disruption of a distribution center or third-party shipping carriers could delay merchandise delivery to stores.
• Macroeconomic pressures — Inflation, economic downturns, occupancy and transportation costs, and geopolitical events could reduce consumer spending and profitability.

Outlook

For fiscal 2026 ending January 30, 2027, management raised its earnings per share outlook while keeping net sales guidance approximately flat. The company plans 75 new store openings and expects comparable store sales growth of ~2%. Gross margin is projected at ~40.7%, operating income of $340-$348 million, and adjusted net income of $271-$277 million; the outlook does not assume any impact from IEEPA tariff refunds.