Burlington Stores Inc (NYSE:BURL)’s stock opened 6% higher after the retailer reported first-quarter EPS of $0.57 on revenue of $1.3 billion, beating estimates by $0.09 per share and $30 million, respectively. Sales rose by 10.2% year-over-year as comparable-store sales inched up 4.3%. Gross margin was up 35 basis points in the quarter to 40.1% and adjusted EBITDA appreciated by 19.3% year-over-year to $121 million. Guidance is strong with Burlington expecting net sales growth of 7.1% to 7.6%, comparable store sales growth of 3% to 3.5%, and adjusted EPS of $2.68 to $2.78 for the full year. They also expect to add 25 new stores. Given the strong economy and low crude prices, it’s perhaps not surprising that shares have done well (up over 30% year-to-date). The growth of Burlington Stores’ stock was not unnoticed by hedge funds and the number of bullish hedge fund bets increased by four recently.
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At the moment there are a multitude of metrics shareholders employ to evaluate publicly traded companies. A duo of the most underrated metrics are hedge fund and insider trading sentiment. Our researchers have shown that, historically, those who follow the top picks of the top money managers can trounce the broader indices by a solid amount (see the details here).
At the end of the first quarter, a total of 37 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 12% from the fourth quarter of 2015. With hedgies’ sentiment swirling, there exists an “upper tier” of noteworthy hedge fund managers who were boosting their stakes significantly (or already accumulated large positions).
Of the funds tracked by Insider Monkey, Phill Gross and Robert Atchinson’s Adage Capital Management has the biggest position in Burlington Stores Inc (NYSE:BURL), worth close to $170.5 million, amounting to 0.5% of its total 13F portfolio. The second largest stake is held by Dmitry Balyasny of Balyasny Asset Management, with a $111.4 million position; 0.7% of its 13F portfolio is allocated to the company. Remaining hedge funds and institutional investors with similar optimism encompass Alexander Mitchell’s Scopus Asset Management, Robert Pohly’s Samlyn Capital and Gabriel Plotkin’s Melvin Capital Management.
Since Burlington Stores’ stock saw an increase in popularity, key money managers were breaking ground themselves and on the next page, we are going to take a closer look at some funds that initiated stakes during the first quarter. In addition, at the end of this article we will also compare BURL to other stocks including AmeriGas Partners, L.P. (NYSE:APU), Hospitality Properties Trust (NYSE:HPT), and ABIOMED, Inc. (NASDAQ:ABMD) to get a better sense of its popularity.
Balyasny Asset Management, managed by Dmitry Balyasny, initiated the biggest position in Burlington Stores Inc (NYSE:BURL). Balyasny Asset Management had $111.4 million invested in the company at the end of the quarter. Robert Pohly’s Samlyn Capital also made a $62.7 million investment in the stock during the quarter. The other funds with brand new BURL positions are Louis Bacon’s Moore Global Investments, Drew Cupps’s Cupps Capital Management, and Bruce Kovner’s Caxton Associates LP.
Let’s also examine hedge fund activity in other stocks similar to Burlington Stores Inc (NYSE:BURL). We will take a look at AmeriGas Partners, L.P. (NYSE:APU), Hospitality Properties Trust (NYSE:HPT), ABIOMED, Inc. (NASDAQ:ABMD), and HEICO Corporation (NYSE:HEI). All of these stocks’ market caps are similar to BURL’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| APU | 7 | 5280 | -2 |
| HPT | 15 | 56784 | 3 |
| ABMD | 24 | 387419 | 3 |
| HEI | 21 | 274019 | -4 |
As you can see these stocks had an average of 17 hedge funds with bullish positions and the average amount invested in these stocks was $181 million. That figure was $753 million in BURL’s case. ABIOMED, Inc. (NASDAQ:ABMD) is the most popular stock in this table. On the other hand AmeriGas Partners, L.P. (NYSE:APU) is the least popular one with only 7 bullish hedge fund positions. Compared to these stocks Burlington Stores Inc (NYSE:BURL) is more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers, it may be a good idea to analyze it in detail and potentially include it in your portfolio.
Disclosure: None
