Buy This Undervalued Stock Before Everyone Else Does
Ollie's Bargain Outlet (NASDAQ: OLLI) is likely not on the radar of many retail investors. Yet the Pennsylvania-based retailer has steadily expanded across the country, operating 419 stores in 28 states. Admittedly, this pales in comparison to Dollar General's (NYSE: DG) 17,000 stores or larger retailers such as Walmart with more than 4,700 domestic locations. Nonetheless, its small size could draw investors with a longterm investment horizon. Its business model brought significant growth and a loyal customer base before the pandemic -- and that may now give investors a rare opportunity to pick up Ollie's stock out of the bargain bin.
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Ollie's has built a competitive advantage by selling "good stuff cheap." Instead of having to cut margins to the bone, the company focuses on closeout merchandise. It will buy from manufacturers, wholesalers, or other retailers that hold excess inventory they need to unload for various reasons. The store then turns around and sells those items, passing a substantial discount on to the consumer.
Source Fool.com
