Institutional Investor Trims Position in Ollie’s Bargain Outlet

Shares of Ollie's Bargain Outlet came into focus following a significant transaction by a major institutional holder. Recent regulatory filings show Congress Asset Management sold a substantial block of shares, raising questions about portfolio strategy and the stock's near-term trajectory.

According to a filing dated January 10, Congress Asset Management divested 670,615 shares of Ollie's stock. Based on the prevailing quarterly price, this transaction was valued at approximately $80.9 million. Crucially, the fund retained a position of 879,320 shares following the sale, representing about 0.68% of its managed assets. The decision to maintain a sizable holding suggests this move was likely a rebalancing act or profit-taking initiative rather than a wholesale loss of confidence and exit from the position. Nevertheless, the sheer volume of shares sold can increase market supply, potentially creating downward pressure on the share price in the short term.

Strong Operational Performance Provides Foundation

The company's underlying business fundamentals remain robust. For the third quarter of fiscal 2025, Ollie's reported a sales increase of 18.6% to $613.6 million. On a per-share basis, adjusted earnings surged 29.3% higher. Over the past twelve months, the stock has advanced roughly 13%, though this performance has lagged behind the S&P 500's approximate 18% gain. Some market observers view this disparity as indicative of potential catch-up opportunity, provided institutional selling pressure subsides.

Should investors sell immediately? Or is it worth buying Ollie's Bargain Outlet?

Expansion Amidst Sector Turmoil

Ollie's is capitalizing on competitor weakness to accelerate its physical footprint growth. With rival Big Lots navigating bankruptcy proceedings, Ollie's has seized the opportunity to acquire 40 of its former store locations. This strategic move has pushed the company's total store count beyond 600 outlets. This expansion contrasts with broader retail trends, where other chains like GameStop are closing hundreds of locations. The acquisition of these vacant properties offers a cost-effective path to growth and enhances the company's near-term prospects in the brick-and-mortar segment.

Key Data Points:
* Current Share Price: $118.49
* Shares Sold by Congress Asset Management: 670,615
* Remaining Fund Position: 879,320 shares (valued at ~$96.4 million)
* Q3 FY2025 Results: Sales $613.6M (+18.6%); Adjusted EPS +29.3%
* Store Network: >600 stores; 40 former Big Lots locations acquired

While the $81 million sale introduces a near-term overhang, the medium-term outlook for Ollie's appears supported by its compelling sales and profit growth, coupled with opportunistic real estate expansion. Absent further significant institutional distribution, the company's operational strength is expected to remain the central driver for its valuation.