BOOT - Boot Barn: Strong Cash Position Long-Term Growth Prospects Short-Term Headwinds
2024-03-18 05:21:42 ET
Summary
- Boot Barn has experienced strong growth in revenue and plans to add 500 additional stores in the next six years.
- The company's e-commerce sales and same-store sales have declined, but new store sales have softened the blow.
- Despite short-term challenges, BOOT has a strong cash position and a long-term growth strategy, making it an attractive investment option.
One year ago, I recommended a bullish stance on Boot Barn, Inc. ( BOOT ) for a number of reasons. Firstly, the company is well positioned in a TAM of $40 billion industry by mainstreaming its portfolio, which includes a large number of higher margined exclusive brands, while still benefitting from its focus on Western and workwear, which has less competition and stickier customers than your typical retailer and therefore less prone to discounting actions. Secondly, it has doubled its revenue in three years by growth in the format of new and higher revenue-generating store models throughout the US. The company has a strong cash position and plans to add 500 additional stores in the next six years, expecting this to contribute an extra $1.5 billion to the top line. Lastly, the stock was and continues to trade well below its peak of $130. Since my first article, investors have been rewarded with returns of 13.65%....
Boot Barn: Strong Cash Position, Long-Term Growth Prospects, Short-Term Headwinds