Here’s What Affected Boot Barn Holdings (BOOT) in Q1

Soumya Eswaran

Mon, Apr 28, 2025, 7:56 AM 3 min read

SouthernSun Asset Management, LLC, an investment management firm, released its “SouthernSun Small Cap Strategy” first quarter 2025 investor letter. A copy of the letter can be downloaded here. In the first quarter, the strategy returned -11.32% on a gross basis (-11.48% net) compared to a -9.48% return for the Russell 2000 Index and -7.74% for the Russell 2000 Value Index. The strategy returned -12.55% on a gross basis (-13.21% net) for the trailing twelve months compared to -4.01% and -3.12% respectively for the indexes over the same period. In addition, please check the top 5 holdings of the strategy to know its best pick in 2025.

In its first-quarter 2025 investor letter, SouthernSun Small Cap Strategy highlighted stocks such as Boot Barn Holdings, Inc. (NYSE:BOOT). Boot Barn Holdings, Inc. (NYSE:BOOT) is a lifestyle retail chain that offers western and work-related footwear, apparel, and accessories. The one-month return of Boot Barn Holdings, Inc. (NYSE:BOOT) was -4.51%, and its shares lost 6.56% of their value over the last 52 weeks. On April 25, 2025, Boot Barn Holdings, Inc. (NYSE:BOOT) stock closed at $102.59 per share with a market capitalization of $3.139 billion.

SouthernSun Small Cap Strategy stated the following regarding Boot Barn Holdings, Inc. (NYSE:BOOT) in its Q1 2025 investor letter:

"Boot Barn Holdings, Inc. (NYSE:BOOT) was the top detractor in the Small Cap strategy after a very strong performance in 2024. In our opinion, BOOT's results have been excellent when looking back over longer periods of time. Over the last 5 years, their EBITDA/share has grown at a 23% CAGR. In our opinion, the stock has been hit hard recently by concerns about the health of the consumer and concerns about rising costs due to tariffs on imports. The company imports approximately 30% of their products from China; however, management expects to be able to offset the impact of tariffs with pricing, and they believe that their competitors will face similar challenges. As we look forward, we believe BOOT has a strong market position, robust growth plans for new stores, a track record of improving margins, and a clean balance sheet."

A farmer standing in a sun-drenched field wearing overalls and a rugged pair of western-style boots.

Boot Barn Holdings, Inc. (NYSE:BOOT) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 29 hedge fund portfolios held Boot Barn Holdings, Inc. (NYSE:BOOT) at the end of the fourth quarter compared to 29 in the third quarter. In the third quarter of fiscal 2025, Boot Barn Holdings, Inc.’s (NYSE:BOOT) net sales increased 16.9% to $608 million. While we acknowledge the potential of Boot Barn Holdings, Inc. (NYSE:BOOT) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.