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IPO Report: Burlington Holdings (BURL)

By  +Follow October 1, 2013 9:27AM
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Founded in 1972, Burlington Holdings ($BURL) is a national off-price retailer of high quality branded apparel, operating 503 stores, inclusive of an internet store, in 44 states and Puerto Rico.  BURL’s goal is to open 25 new stores annually

Six IPOs are scheduled for this week. The full IPO calendar can be found at IPOpremium.

Based in Burlington, NJ, FURL scheduled a $200 million IPO with a market capitalization of $1 billion at a price range mid-point of $15, for Wednesday, October 2, 2013.

S-1 filed September 19, 2013.  Manager, Joint Managers:  J.P. Morgan; Morgan Stanley; BofA Merrill;  Goldman; Wells Fargo Securities.  Co-Managers:  BMO Capital; Guggenheim; Telsey Advisory; Cowen; SunTrust Robinson Humphrey; Ramirez

Summary

Founded in 1972, BURL is a national off-price retailer of high quality branded apparel, operating 503 stores, inclusive of an internet store, in 44 states and Puerto Rico.

BURL’s goal is to open 25 new stores annually and BURL believes the U.S. market can support at least 1,000 stores, which is only a doubling from the current base of 503 stores.

BURL is highly leveraged: since February 2011 BURL paid out $636 million in cash dividends to its private equity owner, paid for by increased debt.

Valuation

Valuation Ratios

Mrkt

Price /

Price /

Price /

Price /

% offered

annualizing june 6 mos

Cap (MM)

Sls

Erngs

BkVlue

TanBV

in IPO

Burlington Holdings

$1,074

0.3

42.5

-4.0

-0.7

19%

Seasonal business, p/e based on ’12 yr

 

 

 

 

 

P/E adjusted for interest savings from debt repayment

38.4

 

 

 

Glossary

BURL is highly leveraged (big debt burden), with a negative price-to-book value of -4.  It operates on razor then margins.  For the year ended December 2012, profit was only .6% of sales.

As demonstrated by J.C. Penny, the retail channel can be unforgiving when mistakes are made.

Conclusion

Neutral to positive because investors like the10% sales increase for the June six months.

Business

Founded in 1972, BURL is a national off-price retailer of high quality branded apparel, operating 503 stores, inclusive of an internet store, in 44 states and Puerto Rico.

BURL believes it is a market leader in the fast growing off-price retail channel.

Off-Price retail channel

BURL offers merchandise using an Every Day Low Price (“EDLP”) model with savings up to 60-70% off department and specialty store regular prices.  BURL features merchandise from over 3,500 vendors, with a focus on major nationally-recognized brands.

The average store size is 80,000 square feet, which is two to three times the size of the largest off-price competitors’ stores. BURL’s  larger store size has allowed the company to offer more categories and substantially more breadth in each product category than off-price competitors.

Growth history

BURL has opened an average of 23 new stores per year since 2006 and new stores have an average payback period of less than three years. Over 98% of the stores are profitable on a store-level cash flow basis, and BURL believes it has considerable room to grow profitability

Growth plan

By the end of Fiscal 2013 BURL anticipates that 66% of its stores will either be new, refreshed, remodeled or relocated since 2006.

Under BURL’s enhanced real estate selection process, BURL opened 15 new stores in Fall 2011 and 6 new stores in Spring 2012, which, on average, have performed in line with their initial sales projections during their first full year of operation.

BURL’s goal is to open 25 new stores annually and BURL believes the U.S. market can support at least 1,000 stores, which is only a doubling from the current base of 503 stores.

Competition

Competitors include national chains such as the following: JCPenney, Sears and Kohl’s.   BURL define national chains as retail stores with an average store size of 60,000 to 100,000 square feet that offer a range of moderately priced goods across multiple categories.

Department stores competition includes, among others, the following retailers: Macy’s, Neiman Marcus and Saks Fifth Avenue.  BURL defines department stores as retail stores with an average store size of 100,000 to 150,000 plus square feet that feature an array of nationally recognized, moderate and better priced goods.

5% stockholders pre-IPO

Bain Capital and related funds, 93.3%

Dividends

No future dividends anticipated.

In February 2013, BURL declared a cash dividend of $336 million, paid for by borrowings.  In February 2011, BURL  paid a $300 million cash dividend, paid for by borrowings.

Use of proceeds

BURL  expects to net $181.5 million from its IPO.

BURL intends to use the proceeds, together with cash on hand, to redeem $170.6 million aggregate principal amount of 9.00%/9.75% Senior Notes due 2018, to pay an advisory  termination fee with an affiliate of Bain Capital of $11.0 million, and for other general corporate purposes.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions.


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Results for burl
NASDAQ
16 Sep 14 14:17:32
$BURL - Current Report Filing (8-k) http://t.co/sPv5BltjS0
4-traders.com
16 Sep 14 14:15:05
BURLINGTON STORES : Change in Directors or Principal Officers, Financial Statements and Exhibits (form 8-K) http://t.co/jiN6dXUqnb $BURL
4-traders.com
16 Sep 14 14:10:04
Burlington Stores : Announces Additions to its Board of Directors http://t.co/ZdfnbLdgZv $BURL
NASDAQ
16 Sep 14 14:09:02
$BURL - Burlington Stores, Inc. Announces Additions to its Board of Directors http://t.co/J8aVc9j0tf
PennyStock Zone
16 Sep 14 13:50:45
Best day trading DVD by Fous Alerts check it out! http://t.co/HJ6WDp65fM #stocks #trading #nasdaq #nyse $XRS $MCHP $GS $BURL $VOD $IRF
US Banking News
16 Sep 14 11:41:10
Weekly Analysts’ Ratings Changes for Burlington Stores $BURL http://t.co/iwYq15AYkg
Ticker Report
16 Sep 14 11:28:56
Weekly Analysts’ Ratings Changes for Burlington Stores $BURL http://t.co/jyBySKTalK
Irma Doucet
16 Sep 14 07:01:08
$burl Burlington Stores Inc (BURL) Updates FY15 Earnings Guidance http://t.co/NO9QIpuJ7u
PennyStock Zone
16 Sep 14 06:51:20
Best day trading DVD by Fous Alerts check it out! http://t.co/AeQ95GG2rM #stocks #trading #nasdaq #nyse $XRS $MCHP $GS $BURL $VOD $IRF
InterCooler
16 Sep 14 05:50:02
Burlington Stores PT Raised to $42.00 at Cowen and Company $BURL http://t.co/kBqdyWdVf0
Sleek Money
16 Sep 14 05:38:06
Burlington Stores CEO Thomas Kingsbury Sells 110,000 Shares $BURL http://t.co/vLrD9onTS7
InterCooler
16 Sep 14 05:34:56
Insider Selling: Joyce Manning Magrini Unloads 18,609 Shares of Burlington Stores Stock $BURL http://t.co/nhn1KLonu3
Ticker Report
15 Sep 14 17:30:34
Insider Selling: Thomas Kingsbury Unloads 110,000 Shares of Burlington Stores Stock $BURL http://t.co/rnhwad5Rdl
WKRB News
15 Sep 14 17:21:48
Insider Selling: Paul C. Tang Sells 6,527 Shares of Burlington Stores Stock $BURL http://t.co/kGmgVJ89dd
Ticker Report
15 Sep 14 17:15:57
Burlington Stores EVP Sells $687,789 in Stock $BURL http://t.co/J6GwuUZaeE
US Banking News
15 Sep 14 17:14:24
Insider Selling: Burlington Stores EVP Sells 6,527 Shares of Stock $BURL http://t.co/Uy4oRLOn6G
US Banking News
15 Sep 14 16:58:11
Burlington Stores CEO Thomas Kingsbury Sells 110,000 Shares $BURL http://t.co/UCzbtp9pEO
US Banking News
15 Sep 14 16:58:10
Burlington Stores EVP Sells $687,789 in Stock $BURL http://t.co/P8NCjGpkpO
InsiderTradingWire
15 Sep 14 14:05:57
JOYCE MAGRINI MANNING, Executive Vice Pres of Burlington Stores Sells $708,350 Worth of $BURL - #Form4 ... - ...
InsiderTradingWire
15 Sep 14 14:05:49
Marc Katz, Executive Vice Pres of Burlington Stores Sells $1,063,110 Worth of $BURL - #Form4 #InsiderTrading - ...
InsiderTradingWire
15 Sep 14 14:05:40
Paul Metcalf, Executive Vice Pres of Burlington Stores Sells $1,043,452 Worth of $BURL - #Form4 #InsiderTrading - ...
InsiderTradingWire
15 Sep 14 14:05:28
Thomas Kingsbury, Pres & CEO of Burlington Stores Sells $3,885,112 Worth of $BURL - #Form4 #InsiderTrading - ...
InsiderTradingWire
15 Sep 14 14:05:19
Fred Hand, Executive Vice Pres of Burlington Stores Sells $1,032,928 Worth of $BURL - #Form4 #InsiderTrading - ...
John Ablemann
15 Sep 14 13:30:50
$burl Burlington Stores, Inc. Announces Second Quarter and First Half Fiscal 2014 ... http://t.co/RRcVKuq9sI
James P Worthy
15 Sep 14 13:30:49
$burl Burlington Stores Posts Strong Earnings http://t.co/rK6aInIC5K
PennyStock Zone
15 Sep 14 09:49:28
Best day trading DVD by Fous Alerts check it out! http://t.co/HJ6WDp65fM #stocks #trading #nasdaq #nyse $XRS $MCHP $GS $BURL $VOD $IRF
Chess
15 Sep 14 09:23:47
NEW POST: Five of Today’s Best Chips to Pull from the Bag http://t.co/13qAo2feeH $BURL $EXH $GPRO $HDS $MO
Sleek Money
15 Sep 14 08:21:41
Cowen and Company Increases Burlington Stores Price Target to $42.00 $BURL http://t.co/hys1LJ8g7T
John Turner
15 Sep 14 07:31:28
$burl Burlington Stores, Inc. Announces Second Quarter and First Half Fiscal 2014 ... http://t.co/OmMGtbwpva
PennyStock Zone
15 Sep 14 06:23:11
Best day trading DVD by Fous Alerts check it out! http://t.co/AeQ95GG2rM #stocks #trading #nasdaq #nyse $XRS $MCHP $GS $BURL $VOD $IRF
PennyStock Zone
14 Sep 14 20:55:01
Best day trading DVD by Fous Alerts check it out! http://t.co/HJ6WDp65fM #stocks #trading #nasdaq #nyse $XRS $MCHP $GS $BURL $VOD $IRF
PennyStock Zone
14 Sep 14 19:00:12
Best day trading DVD by Fous Alerts check it out! http://t.co/HJ6WDp65fM #stocks #trading #nasdaq #nyse $XRS $MCHP $GS $BURL $VOD $IRF
PennyStock Zone
14 Sep 14 15:34:23
Best day trading DVD by Fous Alerts check it out! http://t.co/HJ6WDp65fM #stocks #trading #nasdaq #nyse $XRS $MCHP $GS $BURL $VOD $IRF
PennyStock Zone
14 Sep 14 10:12:39
Best day trading DVD by Fous Alerts check it out! http://t.co/HJ6WDp65fM #stocks #trading #nasdaq #nyse $XRS $MCHP $GS $BURL $VOD $IRF
PennyStock Zone
13 Sep 14 16:02:33
Best day trading DVD by Fous Alerts check it out! http://t.co/HJ6WDp65fM #stocks #trading #nasdaq #nyse $XRS $MCHP $GS $BURL $VOD $IRF
FlashRatings
13 Sep 14 12:32:10
Best analyst rated stocks in the last 7 days: $PANW $SLCA $CTLT $OTIC $BNK $AAPL $BURL $MDVN $MAR $AUY https://t.co/5PynpWLWTp
PennyStock Zone
13 Sep 14 11:32:46
Best day trading DVD by Fous Alerts check it out! http://t.co/HJ6WDp65fM #stocks #trading #nasdaq #nyse $XRS $MCHP $GS $BURL $VOD $IRF
PennyStock Zone
12 Sep 14 18:36:17
Best day trading DVD by Fous Alerts check it out! http://t.co/AeQ95GG2rM #stocks #trading #nasdaq #nyse $XRS $MCHP $GS $BURL $VOD $IRF
PennyStock Zone
12 Sep 14 11:37:38
Best day trading DVD by Fous Alerts check it out! http://t.co/HJ6WDp65fM #stocks #trading #nasdaq #nyse $XRS $MCHP $GS $BURL $VOD $IRF
FlashRatings
12 Sep 14 10:43:39
Most heavily analyst rated stocks in the last 72 hrs: $PANW $LULU $AAPL $ULTA $SLCA $EOPN $BURL $CNVR $GTAT $MCD https://t.co/FfyuNRIXnU
Ticker Report
12 Sep 14 08:46:55
Cowen and Company Boosts Burlington Stores Price Target to $42.00 $BURL http://t.co/sqLXNIspAg
US Banking News
12 Sep 14 06:41:11
Burlington Stores Price Target Increased to $42.00 by Analysts at Cowen and Company $BURL http://t.co/U6XE9iM5UZ
Tina Scibilia
12 Sep 14 06:25:40
Applications for the $Burl Scoggins Scholarship are available in the counseling office. Deadline is October 10th
Sleek Money
12 Sep 14 06:06:19
Burlington Stores PT Raised to $44.00 at Telsey Advisory Group $BURL http://t.co/JkXi9yX9Ao
Ticker Report
12 Sep 14 04:31:50
Burlington Stores PT Raised to $42.00 at Goldman Sachs $BURL http://t.co/Hcj2HhM7wg
Sleek Money
12 Sep 14 03:53:59
JPMorgan Chase & Co. Increases Burlington Stores Price Target to $40.00 $BURL http://t.co/T9u1LRBiNL
4-traders.com
11 Sep 14 11:10:07
BURLINGTON STORES : Management's Discussion and Analysis of Financial Condition and Results of Operations (... http://t.co/sWF03pdK77 $BURL
FlashRatings
11 Sep 14 10:51:48
Most heavily analyst rated stocks in the last 72 hrs: $PANW $AAPL $CTLT $SYF $MAR $EOPN $MCD $BURL $SLCA $GTAT https://t.co/FfyuNRIXnU
US_proptrader
11 Sep 14 09:52:27
$AEGR $AUXL $BURL $CMGE $CSLT $HIMX $NBR $SCOK $TWTR autocharts @ http://t.co/hj7PGeTQk3
Ticker Report
11 Sep 14 09:46:59
Burlington Stores Price Target Increased to $44.00 by Analysts at Telsey Advisory Group $BURL http://t.co/6EqPgPb6lJ
				
				
By  +Follow October 1, 2013 9:27AM
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