Dick’s Sporting Goods (DKS) stock is trading deep in negative territory Wednesday even after the athletic apparel and equipment retailer beat top- and bottom-line expectations for its second quarter and raised its full-year outlook.
In the 13 weeks ended August 3, Dick's Sporting Goods reported revenue of $3.5 billion, an increase of 7.8% year-over-year, driven by a 4.5% jump in comparable-store sales. Its earnings per share (EPS) were up 55% from the year-ago period to $4.37.
The quarterly results were "powered by our compelling omni-channel athlete experience, differentiated product assortment, best-in-class teammate experience and our ability to create deep engagement with the Dick's brand," said Dick's Sporting Goods CEO Lauren Hobart in a statement. "Our Q2 comparable-store sales were driven by growth in average ticket and transactions, and with growth in sales, gross margin expansion and SG&A leverage, we delivered earnings-before-taxes margin of nearly 14%."
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
The results beat analysts' expectations. Wall Street was anticipating revenue of $3.44 billion and earnings of $3.83 per share, according to CNBC.
"Because of our strong Q2 performance and the confidence we have in our business, we are again raising our full-year outlook," Hobart said.
The company now anticipates comparable-store sales growth in the range of 2.5% to 3.5% and earnings per share of $13.55 to $13.90. This compares with its previous outlook of comparable-store sales growth between 2% to 3% and EPS in the range of $13.35 to $13.75.
Dick's added that it continues to anticipate revenue will arrive between $13.1 billion to $13.2 billion.
However, the midpoints of Dick's outlook for the full fiscal year failed to meet analysts' high expectations for the year. Specifically, Wall Street is forecasting revenue of $13.24 billion and earnings of $13.79 per share.
Is Dick's Sporting Goods stock a buy, sell or hold?
Even with today's drop, Dick's Sporting Goods is up more than 47% for the year-to-date. And Wall Street is bullish on the consumer discretionary stock.
According to S&P Global Market Intelligence, the average analyst target price for DKS stock is $239.08, representing implied upside of roughly 10% to current levels. Meanwhile, the consensus recommendation is a Buy.
However, not everyone is so upbeat toward Dick's Sporting Goods. Financial services firm Wedbush, for instance, has a Neutral rating (equivalent to a Hold) and a $250 price target on DKS stock.
While Wedbush analyst Seth Basham anticipated a beat-and-raise quarter from the sporting goods retailer, he says high investor expectations, decelerating consumer spending trends, and an elevated valuation keeps him on the sidelines at the moment.
Related Content
-
Will Utah Stop Taxing Social Security Benefits?Retirement Taxes Utah Gov. Spencer Cox wants to end the state's tax on Social Security income.
-
IRS Shakeup? What Trump's Commissioner Pick Could Mean for TaxesIRS An unconventional nominee comes amid broader efforts to reshape the IRS and tax policy in 2025.
-
What's Better Than Investing in Crypto? These 'Boring' PicksCryptocurrency may be good for a thrill, but older investors are better off with assets like bonds, guaranteed annuities, CDs and maybe dividend-paying stocks.
-
Four Actions to Lessen Retirement Stress for Women (and Men)Saving for retirement is anxiety-inducing for everyone, especially women. Following this four-part action plan can help improve your financial security.
-
Year-End Retirement Tax Planning Actions if You Have $1 Million or MoreConsider implementing these four strategies before December 31 to potentially improve your tax situation for this year and the future.
-
Five Simple Strategies to Ensure a Happy RetirementEmployer retirement plans are great, but individual responsibility plays a huge role in retirement success. Here's how to empower yourself.
-
25 Financial Moves to Consider Before December 31Tidying up your financial house before the New Year kicks off will put you in a great position to have a financially satisfying and successful 2025.
-
Five Side Hustles You Could Turn Into a Full-Time BusinessYou might be able to capitalize on your expertise in ways you haven't thought of, possibly even leading to quitting your 9-to-5 job to do what you love.
-
Stock Market Today: Nasdaq Nabs New High After Jobs DataThe S&P 500 also closed at its highest level ever, while the Dow Jones Industrial Average was pressured by another down day for UnitedHealth stock.
-
Rebound in Jobs Growth Keeps Fed on Track: What the Experts Are SayingJobs Report No nasty surprises in the November payrolls data leaves a quarter-point cut in play.
