DB:8BJ

Stock Analysis Report

BJ's Wholesale Club Holdings

Executive Summary

BJ's Wholesale Club Holdings, Inc. operates as a warehouse club on the East Coast of the United States.

Rewards

Trading at 56.8% below its fair value

Earnings are forecast to grow 6.5% per year

Earnings grew by 59.6% over the past year

Risk Analysis

Has a high level of debt

Shareholders have been diluted in the past year



Snowflake Analysis

Solid track record and good value.


Similar Companies

Share Price & News

How has BJ's Wholesale Club Holdings's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 8BJ has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

3.1%

8BJ

1.6%

DE Consumer Retailing

0.2%

DE Market


1 Year Return

-13.8%

8BJ

3.3%

DE Consumer Retailing

14.4%

DE Market

Return vs Industry: 8BJ underperformed the German Consumer Retailing industry which returned 3.3% over the past year.

Return vs Market: 8BJ underperformed the German Market which returned 14.4% over the past year.


Shareholder returns

8BJIndustryMarket
7 Day3.1%1.6%0.2%
30 Day-1.9%2.8%0.9%
90 Day-7.3%3.0%4.6%
1 Year-13.8%-13.8%7.4%3.3%17.9%14.4%
3 Yearn/a7.3%-3.4%15.7%5.6%
5 Yearn/a10.6%-6.3%23.4%6.5%

Price Volatility Vs. Market

How volatile is BJ's Wholesale Club Holdings's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is BJ's Wholesale Club Holdings undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: 8BJ (€20.2) is trading below our estimate of fair value (€46.81)

Significantly Below Fair Value: 8BJ is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 8BJ is good value based on its PE Ratio (14.2x) compared to the Consumer Retailing industry average (21.1x).

PE vs Market: 8BJ is good value based on its PE Ratio (14.2x) compared to the German market (20.7x).


Price to Earnings Growth Ratio

PEG Ratio: 8BJ is poor value based on its PEG Ratio (2.2x)


Price to Book Ratio

PB vs Industry: 8BJ has negative assets, so we can't compare its PB Ratio to the XE Consumer Retailing industry average.


Next Steps

Future Growth

How is BJ's Wholesale Club Holdings forecast to perform in the next 1 to 3 years based on estimates from 15 analysts?

6.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 8BJ's forecast earnings growth (6.5% per year) is above the savings rate (-0.4%).

Earnings vs Market: 8BJ's earnings (6.5% per year) are forecast to grow slower than the German market (13.3% per year).

High Growth Earnings: 8BJ's earnings are forecast to grow, but not significantly.

Revenue vs Market: 8BJ's revenue (2.3% per year) is forecast to grow slower than the German market (5% per year).

High Growth Revenue: 8BJ's revenue (2.3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 8BJ's Return on Equity is forecast to be very high in 3 years time (206.6%).


Next Steps

Past Performance

How has BJ's Wholesale Club Holdings performed over the past 5 years?

42.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 8BJ has high quality earnings.

Growing Profit Margin: 8BJ's current net profit margins (1.6%) are higher than last year (1%).


Past Earnings Growth Analysis

Earnings Trend: 8BJ's earnings have grown significantly by 42.7% per year over the past 5 years.

Accelerating Growth: 8BJ's earnings growth over the past year (59.6%) exceeds its 5-year average (42.7% per year).

Earnings vs Industry: 8BJ earnings growth over the past year (59.6%) exceeded the Consumer Retailing industry -0.6%.


Return on Equity

High ROE: 8BJ's liabilities exceed its assets, so it is difficult to calculate its Return on Equity.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is BJ's Wholesale Club Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: 8BJ has negative shareholder equity, which is a more serious situation than short term assets not covering short term liabilities.

Long Term Liabilities: 8BJ has negative shareholder equity, which is a more serious situation than short term assets not covering long term liabilities.


Debt to Equity History and Analysis

Debt Level: 8BJ has negative shareholder equity, which is a more serious situation than a high debt level.

Reducing Debt: 8BJ's has negative shareholder equity, so we do not need to check if its debt has reduced over time.

Debt Coverage: 8BJ's debt is well covered by operating cash flow (21.7%).

Interest Coverage: 8BJ's interest payments on its debt are well covered by EBIT (4x coverage).


Balance Sheet

Inventory Level: 8BJ has a high level of physical assets or inventory.

Debt Coverage by Assets: 8BJ has negative shareholder equity (liabilities exceed assets) therefore debt is not covered by short term assets.


Next Steps

Dividend

What is BJ's Wholesale Club Holdings's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

companyn/amarketbottom25%1.3%markettop25%3.6%industryaverage3.6%forecastin3Years0%

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate 8BJ's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate 8BJ's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if 8BJ's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if 8BJ's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of 8BJ's dividend in 3 years as they are not forecast to pay a notable one for the German market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

6.6yrs

Average management tenure


CEO

Lee Delaney (47yo)

US$6,897,480

Compensation

Mr. Lee Delaney has been Chief Executive Officer and Director of BJ's Wholesale Club Holdings and BJ's Wholesale Club, Inc. since February 2, 2020. Mr. Delaney has been President of BJ's Wholesale Club Hol ...


CEO Compensation Analysis

Compensation vs Market: Lee's total compensation ($USD6.90M) is above average for companies of similar size in the German market ($USD2.18M).

Compensation vs Earnings: Insufficient data to compare Lee's compensation with company performance.


Leadership Team

NamePositionTenureCompensationOwnership
Christopher Baldwin
Executive Chairman2.1yrsUS$42.06m0.87% $24.3m
Lee Delaney
CEO, President & Director0yrsUS$6.90m0.13% $3.6m
Robert Eddy
Executive VP and Chief Financial & Administrative Officer9.1yrsUS$8.23m0.25% $7.0m
Scott Kessler
Executive VP & Chief Information Officer3.1yrsUS$4.47m0.097% $2.7m
Brian Poulliot
Executive VP & Chief Membership Officer8.1yrsUS$4.44m0.078% $2.2m
William Werner
Senior Vice President of Strategic Planning & Investor Relations0yrsno data0.037% $1.0m
Graham Luce
Senior VP5.1yrsno data0.026% $716.7k
Kirk Saville
Senior Vice President of Corporate Communications4.1yrsno data0.021% $592.0k
Jeff Desroches
Executive VP & Club Operations Officer10.1yrsno data0.11% $3.2m
Caroline Glynn
Senior Vice President of Internal Audit & Asset Protection0yrsno data0.017% $477.7k

6.6yrs

Average Tenure

48yo

Average Age

Experienced Management: 8BJ's management team is seasoned and experienced (6.6 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Christopher Baldwin
Executive Chairman2.1yrsUS$42.06m0.87% $24.3m
Lee Delaney
CEO, President & Director0yrsUS$6.90m0.13% $3.6m
Jonathan Seiffer
Independent Director9.1yrsno data0.042% $1.2m
Robert Steele
Independent Director4.1yrsUS$231.86k0.0034% $94.0k
Thomas Kingsbury
Director0yrsno datano data
Kenneth Parent
Independent Director9.1yrsUS$226.03k0.0034% $94.0k
Michelle Gloeckler
Director0.4yrsno datano data
Maile Clark
Director0.4yrsno datano data
Christopher Peterson
Independent Director1.2yrsUS$81.65k0.0020% $55.9k
Judith Werthauser
Independent Director1.3yrsUS$112.52k0.0029% $81.8k

1.7yrs

Average Tenure

53yo

Average Age

Experienced Board: 8BJ's board of directors are not considered experienced ( 1.7 years average tenure), which suggests a new board.


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 30.2%.


Top Shareholders

Company Information

BJ's Wholesale Club Holdings, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: BJ's Wholesale Club Holdings, Inc.
  • Ticker: 8BJ
  • Exchange: DB
  • Founded:
  • Industry: Hypermarkets and Super Centers
  • Sector: Consumer Retailing
  • Market Cap: US$3.003b
  • Listing Market Cap: US$2.782b
  • Shares outstanding: 137.27m
  • Website: https://www.bjs.com

Number of Employees


Location

  • BJ's Wholesale Club Holdings, Inc.
  • 25 Research Drive
  • Westborough
  • Massachusetts
  • 1581
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
BJNYSE (New York Stock Exchange)YesCommon StockUSUSDJun 2018
8BJDB (Deutsche Boerse AG)YesCommon StockDEEURJun 2018

Biography

BJ's Wholesale Club Holdings, Inc. operates as a warehouse club on the East Coast of the United States. It offers perishable, edible grocery, general merchandise, and non-edible grocery products. The company also sells electronics, computers, office supplies and equipment, home products, health and beauty aids, sporting goods, outdoor living, baby products, toys, and jewelry through Website. As of February 13, 2020, it operated 217 clubs and 143 BJ's Gas locations in 17 states. The company was formerly known as Beacon Holding Inc. and changed its name to BJ's Wholesale Club Holdings, Inc. in February 2018. The company is based in Westborough, Massachusetts. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/19 23:57
End of Day Share Price2020/02/19 00:00
Earnings2019/11/02
Annual Earnings2019/02/02


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.