Dick's stock falls as it warns its year-end profit could miss estimate

By Steve Gelsi

Retailer posts "very strong" results and raises its outlook but the lower end of range falls short of projection

Dick's Sporting Goods Inc.'s stock fell nearly 6% on Wednesday after it beat Wall Street's profit and revenue estimates, but said its full-year profit could miss analyst projections.

The company said the latest quarter's results were "very strong."

Dick's Sporting Goods (DKS) said its net income for the three months ended Aug. 3 rose to $362 million, or $4.37 a share, from $244 million, or $2.82 a share, in the year-ago quarter.

Dick's Sporting Goods beat the FactSet consensus estimate of $3.86 a share.

Sales rose 7.8% to $3.47 billion, ahead of the analyst estimate of $3.44 billion.

Looking ahead, Dick's said it expects full-year 2024 earnings of $13.55 a share to 13.90 a share, up from its earlier view of $13.35 a share to 13.75 a share.

Analysts have estimated a full-year profit of $13.84 a share.

D.A. Davidson analyst Michael Baker reiterated a buy rating on Dick's Sporting Goods and said the company's outlook signals the potential for a weaker performance for the remainder of the year.

"If there is any concern, it's that the guidance increase was less than the 2Q beat, implying a lower than expected back half," Baker said. "But, full year estimates are still likely to go up, and given the track record of beating by double digits in each of the last four quarters, it's reasonable to assume the outlook is conservative."

Based on the company's signals, Baker estimated earnings of $5.88 a share to $6.23 a share for the coming two quarters, below the analyst estimate of $6.68 a share.

Chief Executive Lauren Hobart said the company is gaining market share due to its "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."

Dick's Sporting Goods' stock had been moving up in premarket trades but reversed course and moved lower after the opening bell.

Dick's Sports Goods' stock price fell $13.15 to $219.02 a share.

Including Wednesday's moves, Dick's Sports Goods' stock has risen 49% in 2024, ahead of the 15.6% gain by the S&P 500 SPX.

-Steve Gelsi

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09-04-24 1443ET

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