Boot Barn Gallops to a Bullish Breakout

04/04/2019 5:00 am EST

Focus: CONSUMER

Leo Fasciocco

Investment Columnist and Publisher, Ticker Tape Digest

Boot Barn Holdings (BOOT) saw its stock gallop higher and breaks out from its seven-week, cup-and-handle base, notes technical specialist Leo Fasciocco, editor of Ticker Tape Digest.

With annual revenues of $678 million, BOOT sells western and work-related footwear and clothes for men, women and children. Its stores are near neighborhood shopping centers and in malls.

The company sells denim, western shirts, cowboy hats, belts and belt buckles, western-style jewelry and accessories. It has 218 stores in 31 states.

For the fiscal year ended in March, analysts are forecasting a 90% surge in net to $1.33 a share from the 70 cents reported the year before.

Profits for the fiscal fourth quarter should show a big 59% jump to 27 cents a share from  the 17 cents the year before. The stock sells with a price earnings ratio of 22.

Looking out to fiscal 2020 ending in March, the Street is predicting a 14% rise in net to $1.51 a share from the anticipated $1.33 a share for fiscal 2019.

Net for the fiscal first quarter ending in June is expected to climb 27% to 19 cents a share from the 15 cents the year before. Seven analysts track the stock. The company tends to come in on Street estimates, or above.

The stock came public in 2014 at $17.56 and climbed to an all-time high of $34.43 in 2015. However, it went into a dive and fell to an all-time low of $5.20 in 2016. Since then the stock formed a bottom and has rallied to $28.

The stock hit a a peak near $29 in February, formed a base and then just broke out with a modest pickup in volume. The stock's momentum indicator is strongly bullish.

We are targeting the stock for a move to $37 on the current breakout. A protective stop can be placed near $28. The stock is suitable for aggressive bulls.

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