Dick's Sporting Goods Shares Tank On Weak Earnings, Other Sports Retailers Follow

On Tuesday, shares of Dick’s Sporting Goods (NYSE:DKS) are plummeting, down over 13% to $41.21 per share in afternoon trading after the retailer reported disappointing first-quarter results. As a result, UBS downgraded Dick’s to ‘Hold’ from ‘Buy,’ while other companies in the sporting goods sector are falling as investors are more on edge than ever.

Dick’s reported earnings of 54 cents per share, coming in line with the Zacks Consensus Estimate and jumping 8% year-over-year. Revenues of $1.825 billion, however, fell short of our consensus estimate, while consolidated comps only grew 2.4%, lagging the company’s forecast of a 3% to 4% increase.

Dick’s reiterated its fiscal 2017 guidance, expecting adjusted earnings to range for $3.65 to $3.75 per share. Consolidated comps growth is now projected in the range of 1% to 3%, compares with 2% to 3% projected earlier. For the second-quarter of fiscal 2017, the company anticipates earnings per share to lie in the band of $1.02 to $1.07, with comps growth to range from 2% to 3%.

Other retailers in this sector are also hurting today. Sporting goods peers Hibbett Sports (NASDAQ:HIBB) , Big 5 Sporting Goods (NASDAQ:BGFV) , and Sportsman’s Warehouse Holdings (NASDAQ:SPWH) are all sliding, down 3.93%, 0.93%, and 5.23%, respectively, in afternoon trading. Even hunting, fishing, and camping retailer Cabela’s (NYSE:CAB) took a hit today, down about 0.60% in the same time frame.

Sports retailers haven’t been able to escape the wide net cast by Dick’s first-quarter earnings either. Giants like Under Armour (NYSE:UAA) and Nike (NYSE:NKE) have slipped 4.41% and 1.99% so far today, while Vista Outdoor (NYSE:VSTO) , Columbia Sportwear (NYSE:M) , Finish Line (NASDAQ:FINL) , and Foot Locker (NYSE:FL) are all down, too.

This sector response is similar to what happened when Macy’s (NYSE:M) reported their first-quarter earnings, and many apparel retailers stumbled along with the department store stalwart.

Currently, DKS carries a Zacks Rank #3 (Hold), with a VGM score of ‘A,’ though this is subject to change following its earnings announcement.

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