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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
Evener Investment
30 Sep 14 11:45:04
RT @SeekingAlpha: What Could Cause The U.S. Retail Sector To Outperform In Q4? http://t.co/QgOgF7hIJM $AEO $ARO $BURL $FDO $JCP $KMX $URBN …
Craig Garbers
30 Sep 14 11:44:33
RT @SeekingAlpha: What Could Cause The U.S. Retail Sector To Outperform In Q4? http://t.co/QgOgF7hIJM $AEO $ARO $BURL $FDO $JCP $KMX $URBN …
Seeking Alpha
30 Sep 14 11:41:26
What Could Cause The U.S. Retail Sector To Outperform In Q4? http://t.co/QgOgF7hIJM $AEO $ARO $BURL $FDO $JCP $KMX $URBN $XRT
PennyStock Zone
30 Sep 14 09:23:34
Best day trading DVD by Fous Alerts check it out! http://t.co/HJ6WDp65fM #stocks #trading #nasdaq #nyse $XRS $MCHP $GS $BURL $VOD $IRF
Harry Walkman
30 Sep 14 06:00:48
$burl Burlington Stores Posts Strong Earnings http://t.co/GN6XmvEUIT
John Turner
30 Sep 14 06:00:46
$burl UPDATE: Credit Suisse Initiates Coverage On Burlington Stores Inc http://t.co/swFVRYPdV4
FonsieTrader
30 Sep 14 04:13:44
Bearish MACD Crossovers 1/2 $AHL $BAC $BURL $CAG $DB $ENTR $FXCM $GBX $GPL $GSK $ICE $KPTI $MMP $MON $MRCY $MTU $MVNR http://t.co/fustlkTnR6
PennyStock Zone
30 Sep 14 04:00:26
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
30 Sep 14 02:06:43
Best day trading DVD by Fous Alerts check it out! http://t.co/HJ6WDp65fM #stocks #trading #nasdaq #nyse $XRS $MCHP $GS $BURL $VOD $IRF
Mitchell Warren
29 Sep 14 06:12:43
RT @TraderPlanet: The Outperformance In Burlington Stores Isn’t Over Yet http://t.co/M6KN0dyB42 $BURL $SPX $XRT $TMUS via @MitchellKWarren
PennyStock Zone
29 Sep 14 05:50:36
Best day trading DVD by Fous Alerts check it out! http://t.co/HJ6WDp65fM #stocks #trading #nasdaq #nyse $XRS $MCHP $GS $BURL $VOD $IRF
FonsieTrader
29 Sep 14 04:44:21
Bullish MACD Crossovers $AOL $ARCPP $ASPX $ATW $AV $AVG $BBBY $BEE $BLOX $BRCD $BURL $BWC $CEMP $CLMT $CMRX $CVEO http://t.co/GNDUCd1IBJ
PennyStock Zone
29 Sep 14 00:46:57
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
28 Sep 14 13:30:48
Best day trading DVD by Fous Alerts check it out! http://t.co/HJ6WDp65fM #stocks #trading #nasdaq #nyse $XRS $MCHP $GS $BURL $VOD $IRF
OTPicks.com
28 Sep 14 11:50:09
http://t.co/hjgLwIcNgz Emylers: $BURL Up to date company activities and other: Emylers http://t.co/DWmI4xU8YC http://t.co/hjgLwIcNgz
Investors Hangout
28 Sep 14 11:23:42
Emylers: $BURL Up to date company activities and other http://t.co/afrBjKi2jB
Investors Hangout
28 Sep 14 11:23:32
Emylers: $BURL Up to date company activities and other http://t.co/Bst3E4NN6O
Emylers
28 Sep 14 11:03:23
$BURL Up to date company activities and other important information about $BURL http://t.co/w9twenDBfd
stt2318
28 Sep 14 09:52:43
$BURL long setup http://t.co/a99i5Xn9XL
chartguy89
28 Sep 14 09:28:11
BBLU Stock Chart $BBLU $BURL $HD $HAFC http://t.co/3vUo3KjSy9 http://t.co/AwZOJveOVv
lookn4wins
28 Sep 14 09:10:41
$YNDX Daily Chart $YNDX Most recent stock chart and technical analysis. $ADI $BURL $X $DKGR $XLV $FCX http://s http://t.co/ySbdSLPBt6
Extreme Stocks
28 Sep 14 08:10:51
Stock_Tracker: $BURL Recent News 10 retailers that are primed http://t.co/wsv1W4eWtC
Stock_Tracker
28 Sep 14 07:56:57
$BURL Recent News 10 retailers that are primed for huge sales growth 8:26 a.m. Sept. 25, 2014 - Philip van Doo http://t.co/P17kO2zp0z
chartguy89
28 Sep 14 07:53:18
SYY Stock Chart $SYY $BURL $MBLY $GE http://t.co/1UV0vXUv2T http://t.co/4wXQl47uRx
PennyStock Zone
28 Sep 14 00:49:32
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
27 Sep 14 15:32:08
Best day trading DVD by Fous Alerts check it out! http://t.co/HJ6WDp65fM #stocks #trading #nasdaq #nyse $XRS $MCHP $GS $BURL $VOD $IRF
John Kernan
27 Sep 14 10:57:05
RT @CowenResearch: In report today, John Kernan looks at who could benefit from $SHLD declines, including analysis of $BURL $ROST & $TJX
FonsieTrader
27 Sep 14 07:17:13
Bullish MACD Crossovers 1/3 $AOL $ARCPP $ASPX $ATW $AV $AVG $BBBY $BEE $BLOX $BRCD $BURL $BWC $CEMP $CLMT $CMRX $CVEO http://t.co/CACPx6Vto2
stock90ufo
26 Sep 14 13:37:57
RT @OptionsHawk: $BURL - the most impressive retail stock that no-one is talking about...
Thomas Collins
26 Sep 14 13:01:12
$burl Zacks' Bull Of The Day: Burlington Stores (BURL) http://t.co/mPYMNKwuis
Adam
26 Sep 14 11:47:21
RT @OptionsHawk: $BURL - the most impressive retail stock that no-one is talking about...
theWizardofStocks
26 Sep 14 11:26:01
$BURL keeps heading higher. My long term stock is becoming one of my biggest winners along with $TWTR .. Lets not forget $FDO 's win for us!
Forex Signal
26 Sep 14 11:07:57
RT @OptionsHawk: $BURL - the most impressive retail stock that no-one is talking about...
Nancy Boots Davison
26 Sep 14 11:01:30
RT @OptionsHawk: $BURL - the most impressive retail stock that no-one is talking about...
Joe Kunkle
26 Sep 14 10:59:45
$BURL - the most impressive retail stock that no-one is talking about...
PennyStock Zone
26 Sep 14 08:15:48
Best day trading DVD by Fous Alerts check it out! http://t.co/HJ6WDp65fM #stocks #trading #nasdaq #nyse $XRS $MCHP $GS $BURL $VOD $IRF
WKRB News
26 Sep 14 05:21:46
Burlington Stores Coverage Initiated at Credit Suisse $BURL http://t.co/8gvaBVOQnk
Seeking Alpha
25 Sep 14 11:14:54
Burlington Stores Continues To Look Like A Winner http://t.co/qXGMd8iFOn $ROST $TJX $BURL
PennyStock Zone
25 Sep 14 09:41:20
Best day trading DVD by Fous Alerts check it out! http://t.co/HJ6WDp65fM #stocks #trading #nasdaq #nyse $XRS $MCHP $GS $BURL $VOD $IRF
NASDAQ
25 Sep 14 07:05:00
$BURL - Initial Statement of Beneficial Ownership (3) http://t.co/7G9sFsFt1q
Mitchell Warren
25 Sep 14 06:35:12
The Outperformance In Burlington Stores Isn’t Over Yet http://t.co/0hey5ILdV9 via @TraderPlanet $BURL $XRT
TraderPlanet
25 Sep 14 06:33:23
The Outperformance In Burlington Stores Isn’t Over Yet http://t.co/M6KN0dyB42 $BURL $SPX $XRT $TMUS via @MitchellKWarren
PennyStock Zone
25 Sep 14 05:05:10
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
24 Sep 14 23:51:27
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
24 Sep 14 19:59:43
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
24 Sep 14 18:30:54
Best day trading DVD by Fous Alerts check it out! http://t.co/AeQ95GG2rM #stocks #trading #nasdaq #nyse $XRS $MCHP $GS $BURL $VOD $IRF
John Turner
24 Sep 14 12:30:52
$burl UPDATE: Credit Suisse Initiates Coverage On Burlington Stores Inc http://t.co/J23YNxE6RO
Sleek Money
24 Sep 14 09:21:45
Burlington Stores Coverage Initiated by Analysts at Credit Suisse $BURL http://t.co/9zOmGyXAoM
TheStreet Alerts
24 Sep 14 09:18:24
How Will Burlington Stores $BURL Stock Be Affected Today by This Analyst Initiation? http://t.co/YssJO1hqpC
PennyStock Zone
24 Sep 14 08:51:31
Best day trading DVD by Fous Alerts check it out! http://t.co/HJ6WDp65fM #stocks #trading #nasdaq #nyse $XRS $MCHP $GS $BURL $VOD $IRF
				
				
By  +Follow October 1, 2013 9:27AM
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