- For readers wondering whether Burlington Stores at around US$320 is still offering value after a strong run, this article breaks down what the current price might be implying about the stock.
- The share price, with a last close of US$320.21, follows returns of 2.6% over 7 days, 3.9% over 30 days, 7.3% year to date, 30.4% over 1 year, 64.6% over 3 years and 7.0% over 5 years. This performance naturally raises questions about what is already priced in.
- Recent coverage of Burlington Stores has focused on its position in U.S. off-price retail and how investors are weighing that business model against shifting consumer habits. This context helps explain why the market is paying attention to the stock and why valuation has become such a central talking point.
- Simply Wall St currently assigns Burlington Stores a valuation score of 1 out of 6. The next sections will compare different valuation approaches and then finish with a broader way to think about what the current price really means.
Burlington Stores scores just 1/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.
Approach 1: Burlington Stores Discounted Cash Flow (DCF) Analysis
A Discounted Cash Flow, or DCF, model estimates what a business could be worth by projecting its future cash flows and then discounting those cash flows back to today’s dollars.
For Burlington Stores, the model uses a 2 Stage Free Cash Flow to Equity approach. It starts from last twelve months free cash flow of about $351.1 million. Analysts provide FCF estimates out to 2029, with Simply Wall St extrapolating further to create a 10 year cash flow path that runs from $230.4 million in 2026 to $1,832.8 million in 2035. These future amounts are then discounted back to today using the model’s assumptions.
Putting those discounted projections together results in an estimated intrinsic value of about $339.62 per share. Compared with the recent share price around $320.21, the DCF output points to roughly a 5.7% discount, so the model suggests the stock is close to but modestly below its estimated value.
Result: ABOUT RIGHT
Burlington Stores is fairly valued according to our Discounted Cash Flow (DCF), but this can change at a moment's notice. Track the value in your watchlist or portfolio and be alerted on when to act.
Approach 2: Burlington Stores Price vs Earnings
For profitable companies, the P/E ratio is a useful way to link what you pay for each share to the earnings that business is currently generating. It lets you compare how the market prices those earnings against other companies and against what might be considered typical for the sector.
What counts as a “normal” P/E depends on how the market views a company’s growth potential and risk profile. Higher expected growth and lower perceived risk usually support a higher multiple, while lower growth and higher risk tend to pull it down.
Burlington Stores currently trades on a P/E of 32.52x. That is well above the Specialty Retail industry average of 19.50x and also above the peer average of 19.24x, so the stock is priced at a premium using simple comparisons. Simply Wall St’s Fair Ratio, which is 23.56x, goes a step further by estimating the P/E that might be appropriate given Burlington’s earnings growth, profit margins, industry, market cap and risk profile. Because it adjusts for these company specific factors, the Fair Ratio is more tailored than a straight peer or industry comparison. With the current P/E meaningfully above the Fair Ratio, the shares screen as expensive on this metric.
Result: OVERVALUED
P/E ratios tell one story, but what if the real opportunity lies elsewhere? Start investing in legacies, not executives. Discover our 20 top founder-led companies.
Upgrade Your Decision Making: Choose your Burlington Stores Narrative
Earlier it was mentioned that there is an even better way to understand valuation, and on Simply Wall St this comes through Narratives. These are clear stories you choose or build that connect your view of Burlington Stores' future revenue, earnings and margins to a forecast, a fair value and then a simple buy or sell signal by comparing that fair value with the current price. All of this happens inside the Community page used by millions of investors, where Narratives continuously refresh as new news or results arrive. For example, one bullish Burlington Stores Narrative might line up with the US$430 high analyst target, while a more cautious Narrative might sit closer to the US$300 low target, reflecting two very different but equally transparent interpretations of the same company.
Do you think there's more to the story for Burlington Stores? Head over to our Community to see what others are saying!
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com