Ollie's Bargain Outlet (OLLI) is expected to deliver solid Q4 results slightly above consensus, with temporary sales softness from winter storms, while concerns about fading Big Lots-related share gains are overstated and its 2026 earnings are potentially underappreciated, RBC Capital said in a Monday note.

The brokerage expects Q4 comparable sales to increase about 3.5%, broadly in line with consensus, while adjusted earnings per share is projected to rise 23% year over year to $1.46, above the $1.39 consensus estimate.

According to the report, winter storms, including Winter Storm Fern, likely weighed on January traffic and early Q1 trends, pressuring comps, though sales should improve through March with higher U.S. tax refunds.

The brokerage also expects management to issue conservative 2026 guidance, including comparable sales growth of 1% to 2%, about 75 new store openings, and adjusted EPS of roughly $4.35 to $4.45. Analysts surveyed by FactSet expect $4.48.

RBC said investor concerns about Ollie's Bargain Outlet Holdings lapping share gains from Big Lots store closures are overstated, noting the benefits could persist for years as new shoppers gradually convert.

The firm maintained its outperform rating on the stock with a price target of $147.

Price: 104.44, Change: -4.48, Percent Change: -4.11