Is BJ's EPS growth sustainable beyond Q1 2026?

**BJ's EPS growth may not be sustainable beyond Q1 2026** for several reasons:

1. **Recent Performance**: BJ's most recent quarter's EPS was $0.92, with a year-over-year growth rate of -14.81%. This negative growth indicates a recent decline in earnings, which raises questions about the sustainability of future EPS growth.

|code|Ticker|Name|Date|Net Income YoY|Total Revenue YoY|Diluted EPS YoY|market_code|
|---|---|---|---|---|---|---|---|
|BJ|BJ.N|BJ's Wholesale Club|2025 Q1|-4.3574523807472625|4.1365895837982425|-2.35294117647059|169|
|BJ|BJ.N|BJ's Wholesale Club|2025 Q2|10.403959642109271|4.872631226906603|11.340206185567022|169|
|BJ|BJ.N|BJ's Wholesale Club|2025 Q3|19.377313803490537|3.546209604073163|20.618556701030926|169|
|BJ|BJ.N|BJ's Wholesale Club|2025 Q4|-15.91120982779423|-1.4701106008193705|-14.814814814814817|169|

2. **Challenges Ahead**: The company faces several challenges that could impact its future earnings growth. These include:
- **Economic Uncertainties**: BJ's performance is sensitive to economic conditions, and the company has indicated potential impacts from tariffs, which could raise prices and disrupt supply chains.
- **Merchandise Margins**: The company has experienced a decrease in merchandise gross margins, which could affect future earnings if not addressed.
- **Interest Rate Fluctuations and Consumer Trends**: BJ's faces risks from interest rate fluctuations and sensitive consumer behavior, which could affect general merchandise sales.
3. **Strategic Investments**: BJ's has been investing heavily in new club openings and digital expansions, which has led to increased SG&A expenses. These investments are necessary for long-term growth but can strain short-term earnings.
4. **Market Conditions**: The retail industry is competitive, and BJ's success depends on its ability to attract and retain members. The company has seen a slight decrease in operating income, which could be a sign of challenges in maintaining its market position.
5. **Future Outlook**: While BJ's has a history of aggressive business expansions and initiatives like Fresh 2.0, the success of these initiatives in sustaining EPS growth beyond Q1 2026 is uncertain. The company's forecasted annual revenue growth of 6.4% over the next three years does not necessarily translate to EPS growth if costs and expenses increase at a faster rate.

In conclusion, while BJ's has made strategic moves that could potentially boost its performance in the long term, the current data and market conditions suggest that sustaining EPS growth beyond Q1 2026 will be challenging. The company's ability to manage challenges, maintain its value proposition, and control costs will be critical factors in determining the sustainability of its EPS growth.