With consumer sentiment remaining low, Boot Barn BOOT stock may be one to avoid at the moment as a provider of western-style jewelry and accessories, rugged footwear, outerwear, overalls, and denim.

Heeding the broader warning, the University of Michigan’s much-noted consumer sentiment index dropped another 2.7% in May to 50.8%, marking the fifth consecutive monthly decline and down 26.5% from 69.1% a year ago.

Meanwhile, Walmart WMT has warned that it won’t be able to shelter its customers from higher tariffs, with Boot Barn planning to raise its retail prices as well to the same level as its third-party vendors, in a bid to maintain merchandise margin rate. University of Michigan Consumer Sentiment Index

Image Source: University of Michigan Consumer Sentiment Index

Boot Barn Misses its Q4 Expectations

Reporting results for its fiscal fourth quarter last Wednesday, Boot Barn came up short of its top and bottom-line expectations. Sales of $453.75 million missed Q4 estimates of $458.18 million despite rising from $388.46 million in the comparative quarter.

Although Q4 EPS of $1.22 was up from $1.01 per share in the prior period, this missed expectations of $1.24. This also marked the second straight quarter that Boot Barn has missed sales estimates, with the company citing the continued uncertainty around tariffs and the resulting impact on consumer spending in its guidance.

Rising Inventory Levels

On a more subtle but cautious note, it’s noteworthy that during Q4, Boot Barn’s inventory levels increased 25% year over year to $747 million, rising 5.7% on a same-store basis. Boot Barn attributed the spike in inventory levels to the opening of 21 new stores, growth in exclusive brands, and the proactive pull forward of shipments in anticipation of tariffs.

Notably, Boot Barn plans to open 65-70 new stores in its current fiscal year 2026. However, the timing of such could have an adverse effect, considering the company anticipates an $8 million incremental cost due to tariffs, which is expected to affect consumer demand in the second half of the year.Zacks Investment Research

Image Source: Zacks Investment Research

EPS Revisions Have Dropped Over the Last Week

While Boot Barn has reduced its reliance on Chinese factories to offset the cost of higher tariffs, EPS revisions for its current fiscal year 2026 have dropped 5% in the last week from $6.72 to $6.39. Furthermore, FY26 EPS estimates are now down 7% over the last 30 days, with FY27 EPS projections dropping 8% in the last month from $8.07 to $7.39.Zacks Investment Research

Image Source: Zacks Investment Research

Conclusion & Final Thoughts

Now appears to be the time to take profits in Boot Barn stock, with BOOT soaring over +140% in the last two years and up a respectable +6% year to date. To that point, Boot Barn stock lands a Zacks Rank #5 (Strong Sell) and the Bear of the Day based on the trend of declining earnings estimate revisions, with the prerequisite of an unfavorable inventory buildup, something to look out for amid the company’s expansion.

Story Continues

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This article originally published on Zacks Investment Research (zacks.com).

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