Burlington Stores, Inc. ( BURL ) shares are trading slightly higher on Friday.

On Thursday, the company reported first-quarter adjusted earnings per share of $1.60, beating the analyst consensus estimate of $1.41. Quarterly sales of $2.50 billion missed the Street view of $2.52 billion.

The company’s CEO, Michael O’Sullivan, stated that while tariffs are expected to significantly impact merchandise margins, he is confident the company can offset this pressure in other areas of the profit and loss statement, provided tariffs do not rise beyond current levels.

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Here are the key analysts’ views on the company:

Telsey Advisory Group analyst Dana Telsey reiterated the Outperform rating on Burlington, lowering the price forecast from $340 to $300.

In an analyst note, Telsey noted that acquiring prime retail locations remains a key part of Burlington’s strategy to expand its footprint and draw in high-value customers, especially as consumers increasingly prioritize value.

However, due to macroeconomic uncertainty and rising costs tied to acquiring leases from bankrupt retailers, Telsey lowered the firm’s price forecast.

She highlighted that Burlington is adjusting its strategy and staying agile in response to current conditions.

While tariffs are creating short-term challenges, management believes it won’t cause lasting structural shifts in the retail sector.

The company’s FY25 outlook factors in a 30% tariff on imports from China and 10% on goods from other countries.

To reduce its reliance on China, Burlington is collaborating with vendors and sourcing more products already located in the U.S., Telsey noted.

She added that the company has several levers across the cost of goods sold and SG&A to help offset higher costs and support profitability.

BofA Securities analyst Lorraine Hutchinson maintained the Buy rating on the stock, with a price forecast of $350.

According to Hutchinson, the increased order volatility driven by shifting tariffs could actually improve merchandise availability for the off-price sector.

She noted that Burlington’s direct sourcing exposure remains modest at 8%, mostly tied to categories like Home and gifting.

The analyst has modeled a flat gross margin for the second quarter. She anticipates 60 basis points of pressure on gross margin in the second half of the year as tariffs begin to flow through.

However, she suggested that mitigation strategies could offset this future pressure once Burlington and its vendors have had sufficient time to adjust their production processes and pricing structures.

The company has also seen strong comp performance at higher price points, with customers responding well to elevated merchandise. Hutchinson stressed that this trend will continue, especially as more price-sensitive consumers shift toward value options in response to broader retail price increases from tariffs.

Price Action: BURL shares are trading higher by 0.23% to $228.33 at last check Friday.

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