Dick’s Sporting Good’s Earnings are Better Than Expected

Dick’s Sporting Goods (NYSE: DKS) posted better-than-expected fourth quarter earnings after the sporting goods store reported decreasing profit over the last two quarters. The sports retailer hopes to capture more of the women’s fitness apparel market by launching Calia, Carrie Underwood’s fitness line, in stores this week.

Highlights of the report include net income of $15.5 million, a 12% year-over-year increase. The sporting goods retailer posted record-high earnings per diluted share of $1.30, a 17% year-over-year and beating analysts’ estimates of $1.22. Consolidated same store sales increased 3.4% in the quarter, beating the analyst estimate of 1.2%. However, Golf Galaxy, a specialty store owned by Dick’s, experienced a same store sales decrease of 7.1% in the quarter and closed two locations, though analysts are quick to point out that winter is a slow season for golf. On the other hand, the retailer opened six new Dick’s Sporting Goods stores in the quarter.

Looking forward, Dick’s Sporting Goods (NYSE:DKS) expects to post earnings per share of $0.49 to $0.53 on a diluted basis for the first quarter of 2015, below the analyst estimate of $0.57. Dick’s expects same store sales to increase 2% in the first quarter, while analyst estimates are slightly higher at 2.2%. Additionally, the company expects to open nine new locations in the first quarter of 2015.

On March 4th, analyst Kate McShane of CitiBank maintained a Buy rating on DKS and raised her price target to $62. McShane commented that the company’s earnings predictions are “probably conservative,” citing “cleaner inventories, reformatted square footage favoring faster growth and higher margin businesses, new ‘athleisure’ brands, a stronger team sports offering, more profitable e-commerce, and continued premium vendor relationships versus peers” in support of potential high figures in the next report. She concluded, “Dick’s remains our favorite name for 2015 based on the strength of the category, strong merchandising & easier compares.”

Kate McShane has an 82% success rate recommending stocks with a +21.7% average return per recommendation.


Separately on March 4th, analyst Scot Ciccarelli of RBC Capital reiterated a Hold rating on DKS with a price target of $56.Ciccarelli has an 82% success rate recommending stocks with a +20.2% average return per recommendation.


On average, the top analyst consensus for Dick’s Sporting Goods on TipRanks is Hold.

Disclosure: All DKS recommendations sourced from TipRanks.