Piper Jaffray Expects Big Lots (BIG) to Report Solid 3Q Results; Reiterates Overweight

Piper Jaffray reiterated an Overweight rating and $61.00 price target on Big Lots (NYSE: BIG) ahead of the company's 3Q earnings report. Piper Jaffray is expecting solid results for Q3 as a warm Fall has no impact on sales, company specific drivers remain intact, and as lower income consumer sentiment is running 15%-20% y/y.

Analyst Peter Keith commented, "We are maintaining our Overweight rating and $61 PT heading into Friday morning's Q3 earnings release. We are expecting solid results for Q3 as a warm Fall has no impact on sales, company specific drivers remain intact, and as lower income consumer sentiment is running 15%-20% y/y. Additionally, with Q4 promo activity comparable y/y, we expect BIG to maintain its Q4 comp guide of +1% to +2%. Looking ahead to 2016, we see potential for two nascent drivers: (1) Expanding its subprime credit offering with a private label credit card (current being tested in ~100 stores); and (2) Wal-mart SKU rationalization driving more closeout opportunities. Finally, with short-interet still relatively high at 21% (with 14 days to cover) we believe expectations on BIG remain fairly low."

For an analyst ratings summary and ratings history on Big Lots click here. For more ratings news on Big Lots click here.

Shares of Big Lots closed at $44.99 yesterday.

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