Dick’s Sporting Items Board Authorizes Further $2B Share Buyback

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Dick’s sporting goods (DKS) – Get Dick’s Sporting Goods, Inc. report, the country’s largest sporting goods chain, said in a filing with the Securities and Exchange Commission that its board of directors has approved additional share buybacks of $ 2 billion.

The authorization is valid for five years. As of December 16, the company repurchased approximately 7.7 million common shares for $ 829.1 million in fiscal 2022, which began February 1.

This includes approximately 3.7 million shares for $ 403 million in the current fiscal quarter.

Approximately $ 202.1 million remains under the $ 1 billion share buyback program approved on June 12, 2019.

Dick’s stock was recently trading at $ 104.47, up 5%. It had slumped 22% in the past three months.

Morningstar analyst David Swartz is pessimistic about the company and puts the fair value at 69 US dollars.

“We believe No-Moat Dick’s Sporting Goods is struggling to stay relevant as sporting goods are sold through an increasing number of channels,” he wrote on Wednesday.

“Although sales increased during the pandemic, we believe the impact will be temporary, as sporting goods retail growth has generally been minimal due to outside competition.

“According to IBISWorld, the sporting goods retail sector had an average annual growth of only 1.3% in the five years before the pandemic.

“Dick’s competitors include e-commerce operators like Wide-Moat Amazon (AMZN) – Get the Amazon.com, Inc. Review, Bulk retailers like Wide-Moat Walmart (WMT) – Get the Walmart Inc. report, Specialty stores like Schmalgraben Lululemon (LULU) – Get the report from Lululemon Athletica Inc. and Bass Pro Shops / Cabela’s as well as branded stores and own e-commerce from large providers. “

Dick’s reported better than expected earnings for the quarter ended October 30th. Earnings were $ 3.19 per share on sales of $ 2.75 billion. Analysts polled by FactSet had forecast earnings of $ 2.06 per share on sales of $ 2.5 billion.