Shares of under-the-radar foot and apparel retailer Boot Barn can surge as consumers buy up western wear, Bank of America said Friday. Analyst Jason Haas initiated coverage of the company with a buy rating and $85 price target, saying that Boot Barn’s expansion toward its 900 domestic store target should help it take share from a fragmented mom and pop market and win over rural consumers. Haas’ price target implies upside of 35% from Thursday’s close. “Boot Barn has a multi-year runway to grow its store count and take share in the fragmented western, work, and country lifestyle footwear and apparel market,” he wrote, calling Boot Barn a “best-in-class western footwear and apparel” retailer. “With larger scale comes better pricing, better selection, more exclusive brands, and better customer service.” Boot Barn is benefitting from a pandemic-induced migration to rural areas, and booming interest in cowboy boots and western apparel, Haas said. He does, however, expect this fashion trend to moderate going forward. “While still ‘in-style,’ we’re concerned that this trend has peaked and expect a decline in Boot Barn’s ladies’ fashion boots and apparel going forward,” he wrote. “But we estimate these categories account for just 14% of sales.” Despite their recent earnings revision and 49% drop in 2022, shares are still trading cheap, and well below their historical 19 times forward EPS estimates, Haas also noted. — CNBC’s Michael Bloom contributed reporting
