Cabela's to Open Three Next-Gen Outlets - Analyst Blog

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Cabela's Incorporated ( CAB ) announced that it plans to open three new outlets in Huntsville, AL; Woodbury, NY and Oklahoma City, OK. The stores will be built on the model of Cabela's next-generation stores.

The Huntsville store marks Cabela's foray into the southeastern state of Alabama. The 80,000 sq. feet store will be located at the Parkside Town Centre development and will recruit about 180 full-time and part-time employees. Construction will commence this fall and the store will likely open by the fall of 2015.

The second outlet located in Oklahoma City will also mark Cabela's debut in the state of Oklahoma. Also, spanning 80,000 sq. feet, the store will be located at the Chisholm Creek development Centre. The store will generate employment for nearly 180 full-time and part-time staff when it opens to customers in the fall of 2015. Construction of the store is likely to begin later this year.

The Woodbury location would be Cabela's second outlet in the state of New York following the Cheektowaga outlet. Construction of the 90,000 sq feet store is likely to begin in spring 2015 and is expected to be operational by spring 2016. Situated close to the Woodbury Common Premium Outlets, the store is likely to generate employment for 170 full time and part time staff.

Strong performance of Cabela's next-generation stores continues to cushion its top and bottom lines. Moreover, these next-generation stores are outperforming the company's legacy stores in terms of both sales and profit per square feet. We remain optimistic about this next generation store format as it requires less capital investment, enhances store productivity, and helps to increase sales per square feet.

Further, in the first quarter of fiscal 2014, Cabela's opened 1 store in Augusta, GA. In the second quarter to date it has opened one store each at Greenville, SC and Anchorage, AK. During rest of the quarter, the company intends to open five more stores at Christiana, DE; Woodbury, MN; Missoula, MT; Lovett, TX and Edmonton in Alberta, Canada. Of these locations, Christiana, Woodbury and Edmonton stores were expected to open by May while Missoula and Lovett locations are expected to open this month.

For the third quarter, the company plans to open stores in Acworth, GA; Barrie in Ontario, Canada; Cheektowaga, NY; Nanaimo, British Columbia in Canada; Tualatin, OR; and Bowling Green, KY. For the remainder of 2014, the company has plans to open 11 additional stores.

The above-mentioned 14 new stores will represent 17% growth in square footage area in 2014.

The company's store expansion drive reflects its initiatives to expand in regions that have considerable growth potential. Moreover, the company looks for opportunities to expand its store base to effectively penetrate into its target markets and generate healthy sales.

Currently, Cabela's has a Zacks Rank #3 (Hold). Better-ranked stocks worth considering in the retail sector include Build-A-Bear Workshop Inc. ( BBW ), Five Below, Inc . ( FIVE ) and Office Depot, Inc. ( ODP ). While Build-A-Bear Workshop sports a Zacks Rank #1 (Strong Buy), Five Below and Office Depot carry a Zacks Rank #2 (Buy).

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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