StockStory Sees Limited Upside in Ollie's After Share Decline

Ollie's shares had fallen 9.1% over six months to $82.75 in the period covered by StockStory's analysis, while the S&P 500 gained 16.9%. StockStory said it was not persuaded by the retailer's prospects, citing pressure points in its business and profitability.

The publisher noted Ollie's generated $2.79 billion in revenue over the past 12 months. It said the retailer's smaller scale may limit its bargaining power and distribution reach, though the company has room to add stores.

Ollie's operating margin was 11.3% over the trailing 12 months. StockStory said the margin had stayed broadly steady over the past year, despite revenue growth that it expected would help improve profitability.

The publisher also cited a five-year average return on invested capital of 9.1%, which it described as low compared with leading consumer retailers. It said the stock's valuation of 18.1 times forward earnings was fair, but expressed limited confidence in the company.

As of Friday's close, Ollie's traded at $84.25, down 0.23% from the previous close.