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The Buckle, Inc. (BKE - Free Report) is an apparel and footwear retailer that operates across most of the U.S. The Buckle posted a banner year in 2021 and its outlook is solid as consumers gravitate toward its competitively-priced denim and beyond.
The Buckle runs a financially sound operation, alongside a high dividend yield that helps make it a solid candidate amid rising interest rates and economic uncertainty.
Simple Retail
The Buckle is a retailer focused on what it calls ‘better–priced’ offerings across apparel, footwear, and accessories. The Nebraska-headquartered firm operates roughly 440 stores throughout 42 states, many of which are located within indoor and outdoor malls.
The company’s offerings feature options for everyone from kids to adults, spanning both its own private labels and brand names. The Buckle sells everything from different styles of denim and sportswear to outerwear and boots. The Buckle, which boasts that it’s known as a denim destination, also provides perks such as alterations, a frequent shopper program, and more.
Image Source: Zacks Investment Research
Performance and Outlook
The Buckle went public in the early 1990s and posted YoY revenue growth every year outside of one tiny pullback until it fell on some lean years between 2015 and 2018. BKE started to get back on course in 2019 and 2020 before it posted a blowout 2021. The Buckle’s revenue soared 44% last year from $901 million to $1.30 billion, which was a new company record.
BKE’s comparable store sales matched its overall top-line growth, with online revenue up 16% to account for 17% of total revenue. The retailer’s bottom-line performance was even better. The Buckle’s adjusted earnings soared 94% to $5.16 per share, while its net profit margin came in at 20% for 2021.
The Buckle topped our Q4 earnings estimate by 14% on March 11 and it’s now beaten the Zacks EPS estimate by an average of 45% in the trailing four quarters. The company’s FY22 consensus earnings estimate popped 9% since its release on the back of solid guidance. The bottom-line revisions positivity is part of a longer-term upward revisions trend for Buckle’s earnings.
The Buckle is projected to follow up its great 2021 with 9% higher sales in 2022 and 2% stronger adjusted earnings, based on the most recent Zacks estimates. The company is then projected to post both top and bottom line expansion in 2023.
Image Source: Zacks Investment Research
Other Fundamentals
The Buckle flexed its financial strength in December when it announced a $5.65 per share special cash dividend. The company also raised its quarterly cash dividend by 6% to $0.35 per share. That payout is good enough to yield 4.33% at the moment to blow away the rising 10-year U.S. Treasury’s 2.7%.
BKE’s dividend yield easily tops Nordstrom’s 2.6%, Macy's 2.5%, the S&P 500’s 1.3%, and stands out compared to many of its Retail - Apparel and Shoes peers that don’t pay a dividend. It is worth pointing out that The Buckle’s next payment date is April 28 to shareholders of record at the close of business on April 14—the ex-dividend date for a stock is typically one business day before the record date.
The Buckle’s dividend yield isn’t artificially inflated by a falling stock price. BKE stock has surged 180% in the last two years off its covid lows to outpace its industry’s 53% climb. Looking back over the past five years, Buckle shares have climbed 224% vs. its industry’s 28% downturn and the S&P 500’s 120%.
The stock is now down 10% in the last 12 months, including a roughly 30% drop since November to trade at around $32 per share. The pullback, coupled with The Buckle’s strong earnings outlook has it trading right near decade-long lows of 6.14X forward 12-month earnings. This marks a 40% discount compared to its Apparel and Shoes industry and even stronger value vs. the broader Zacks Nonfood Retail Market.
Image Source: Zacks Investment Research
Bottom Line
The Buckle’s earnings revisions activity helps it land Zacks Rank #1 (Strong Buy) right now, alongside its “B” grade for Value and “A” for Growth in our Style Scores system.
The Buckle stock is somewhat heavily shorted at the moment, which might deter some investors. But the fashion retailer still sits on a strong balance sheet, alongside many other appealing qualities for the current market, from value to dividends.
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Bull of the Day: The Buckle, Inc. (BKE)
The Buckle, Inc. (BKE - Free Report) is an apparel and footwear retailer that operates across most of the U.S. The Buckle posted a banner year in 2021 and its outlook is solid as consumers gravitate toward its competitively-priced denim and beyond.
The Buckle runs a financially sound operation, alongside a high dividend yield that helps make it a solid candidate amid rising interest rates and economic uncertainty.
Simple Retail
The Buckle is a retailer focused on what it calls ‘better–priced’ offerings across apparel, footwear, and accessories. The Nebraska-headquartered firm operates roughly 440 stores throughout 42 states, many of which are located within indoor and outdoor malls.
The company’s offerings feature options for everyone from kids to adults, spanning both its own private labels and brand names. The Buckle sells everything from different styles of denim and sportswear to outerwear and boots. The Buckle, which boasts that it’s known as a denim destination, also provides perks such as alterations, a frequent shopper program, and more.
Image Source: Zacks Investment Research
Performance and Outlook
The Buckle went public in the early 1990s and posted YoY revenue growth every year outside of one tiny pullback until it fell on some lean years between 2015 and 2018. BKE started to get back on course in 2019 and 2020 before it posted a blowout 2021. The Buckle’s revenue soared 44% last year from $901 million to $1.30 billion, which was a new company record.
BKE’s comparable store sales matched its overall top-line growth, with online revenue up 16% to account for 17% of total revenue. The retailer’s bottom-line performance was even better. The Buckle’s adjusted earnings soared 94% to $5.16 per share, while its net profit margin came in at 20% for 2021.
The Buckle topped our Q4 earnings estimate by 14% on March 11 and it’s now beaten the Zacks EPS estimate by an average of 45% in the trailing four quarters. The company’s FY22 consensus earnings estimate popped 9% since its release on the back of solid guidance. The bottom-line revisions positivity is part of a longer-term upward revisions trend for Buckle’s earnings.
The Buckle is projected to follow up its great 2021 with 9% higher sales in 2022 and 2% stronger adjusted earnings, based on the most recent Zacks estimates. The company is then projected to post both top and bottom line expansion in 2023.
Image Source: Zacks Investment Research
Other Fundamentals
The Buckle flexed its financial strength in December when it announced a $5.65 per share special cash dividend. The company also raised its quarterly cash dividend by 6% to $0.35 per share. That payout is good enough to yield 4.33% at the moment to blow away the rising 10-year U.S. Treasury’s 2.7%.
BKE’s dividend yield easily tops Nordstrom’s 2.6%, Macy's 2.5%, the S&P 500’s 1.3%, and stands out compared to many of its Retail - Apparel and Shoes peers that don’t pay a dividend. It is worth pointing out that The Buckle’s next payment date is April 28 to shareholders of record at the close of business on April 14—the ex-dividend date for a stock is typically one business day before the record date.
The Buckle’s dividend yield isn’t artificially inflated by a falling stock price. BKE stock has surged 180% in the last two years off its covid lows to outpace its industry’s 53% climb. Looking back over the past five years, Buckle shares have climbed 224% vs. its industry’s 28% downturn and the S&P 500’s 120%.
The stock is now down 10% in the last 12 months, including a roughly 30% drop since November to trade at around $32 per share. The pullback, coupled with The Buckle’s strong earnings outlook has it trading right near decade-long lows of 6.14X forward 12-month earnings. This marks a 40% discount compared to its Apparel and Shoes industry and even stronger value vs. the broader Zacks Nonfood Retail Market.
Image Source: Zacks Investment Research
Bottom Line
The Buckle’s earnings revisions activity helps it land Zacks Rank #1 (Strong Buy) right now, alongside its “B” grade for Value and “A” for Growth in our Style Scores system.
The Buckle stock is somewhat heavily shorted at the moment, which might deter some investors. But the fashion retailer still sits on a strong balance sheet, alongside many other appealing qualities for the current market, from value to dividends.