Goldman Adds BJ’s Wholesale To Conviction Buy, Lifts PT


Goldman Sachs put BJ’s Wholesale stock onto its Conviction Buy list and raised the price target to $50 (24.5% upside potential) from $49. Shares of the membership-only warehouse club chain operator are up about 1% in pre-market trading on Monday.

On Sept. 21, Goldman analyst Kate McShane commented “BJ’s strong activity during the pandemic (new member acquisition) and recent strategic shifts (real estate are thesis changing events (in our view), [are] accelerating the earnings potential for BJ’s.”

Last month, BJ’s (BJ) reported better-than-expected 2Q earnings of $0.77, compared the Street estimates of $0.60. Its 2Q revenues of $3.95 billion beat analysts’ expectations of $3.73 billion.

BJ’s earnings and revenues increased 97.4% and 18.2%, respectively, on a year-over-year basis. Comparable club sales surged 24.2% during the quarter, benefiting from a surge in the demand for essential goods amid the pandemic. (See BJ stock analysis on TipRanks).

Currently, the Street has a cautiously optimistic outlook on the stock. The Moderate Buy analyst consensus is based on 9 Buys, 5 Holds and 1 Sell. The average price target of $48.50 implies upside potential of about 20.8% to current levels. Shares have surged 76.6% year-to-date.

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