DICK'S (DKS) Buys Affinity Sports To Promote Sporting Spirit

Forging ahead with its DICK'S Team Sports HQ platform launched in Jan 2016, DICK’S Sporting Goods Inc. (NYSE:DKS) acquired Affinity Sports, a San Diego-based sports management technology company. The DICK’S Team Sports HQ is an all-in-one platform that provides various youth sports leagues in the country with three primary services, online registration and team/league websites; custom uniforms and FanWear; and access to donations and sponsorships.

The newly acquired sports management company will add to DICK’S competencies by providing unparalleled services to the major youth sports organizations in the country, including national governing bodies and other large-scale organizations, through the DICK’S Team Sports HQ platform.

This DICK’s platform will use Affinity’s dedicated sports management software to support and abridge the registration, scheduling and communication processes between the national or regional governing bodies, and related leagues. This will not only bridge the communication gaps between these groups but also facilitate better player and coach visibility.

Additionally, it will help league administrators to access the online tools through the DICK’S Team Sports HQ platform to design league specific gears, so that coaches and parents can order uniforms and FanWear through the league website itself. Also, DICK’s Sporting will make donations and sponsorships through its Team Sports HQ platform, encouraging organizations to come forward and support sports participation.

Last week, DICK’S Sporting posted stellar second-quarter fiscal 2016 results, which marked the company’s second straight positive earnings surprise. Apart from outdoing our estimates, both top and bottom lines rose year over year, with earnings and comps also exceeding management’s expectations. Results were driven by robust omni-channel growth, as is evident from the increased eCommerce penetration.

Going forward, this Zacks Rank #3 (Hold) remains committed toward store expansion, enhancing store productivity and undertaking investments in omni-channel business for continued improvement. These factors, along with the splendid quarterly results, encouraged management to raise its comps and earnings outlook for fiscal 2016, which also caused an uptrend in estimates.

Stocks to Consider

Better-ranked stocks in the same industry include Big 5 Sporting Goods Inc. (NASDAQ:BGFV) , Hibbet Sports Inc. (NASDAQ:HIBB) and Barnes & Noble Inc. (NYSE:BKS) , each carrying a Zacks Rank #2 (Buy).