Cars are parked outside a Dick’s Sporting Goods store in Monroe Marketplace, Pennsylvania.
Paul Weber | SOPA pictures | LightRakete | Getty Images
Dick’s Sporting Goods shares fell Tuesday despite the company posting third-quarter results that exceeded analysts’ expectations, causing it to raise its forecast for the year.
The decline came when Dick’s stock broke and was up nearly 150% year-to-date by Monday’s market close. Shares closed Tuesday 4.08% to $ 134.55. At the close of trading on Tuesday, the retailer’s market value is $ 12.01 billion.
Dick’s Chief Executive Lauren Hobart said consumer demand remained strong after the summer season and back to school rush, and that the company’s wide range of products – from golf clubs to running clothes – made it possible to meet the needs of many shoppers.
According to a survey compiled by Refinitiv, the sporting goods giant developed in its third fiscal quarter compared to analysts’ expectations:
- Earnings per share: $ 3.19 adjusted versus $ 1.97 expected
- Revenue: $ 2.75 billion versus an expected $ 2.50 billion
For the three month ended October 30, net income rose to $ 316.5 million, or $ 2.78 per share, from $ 177.2 million or $ 1.84 per share a year ago.
With no items, it made $ 3.19 per share, up from the $ 1.97 analysts had expected.
Revenue rose approximately 14% from $ 2.41 billion a year ago to $ 2.75 billion. That exceeded expectations of $ 2.50 billion.
Sales in the same stores that track sales from stores that have been open for at least 12 months increased 12.2%. Analysts surveyed by StreetAccount had called for an increase of 1.9%.
Dick’s said its online sales were up only 1% year over year, when many consumers shop online, and up 97% on a two-year basis. Ecommerce sales accounted for about 19% of total business, up from 13% in 2019.
With sales accelerating and new customers shopping on its website and in stores during the pandemic, Dick’s has invested in its business to keep shoppers coming back. In March, VRST was launched, an athleisure brand for men. It opened its largest store to date, called House of Sport, in suburbs of Rochester, New York, in April. The store includes an indoor climbing wall, putting green, health and wellness store, and an outdoor athletics field.
And in August, the company announced a collaboration with its largest brand supplier, Nike. Nike’s membership program is now linked to Dick’s loyalty program to allow customers to purchase exclusive Nike shoes and apparel on Dick’s website.
Neil Saunders, managing director of GlobalData Retail, said the company should be commended for its innovation efforts that continued during the health crisis.
“These results are exceptional and mark Dick’s as one of the clear winners in pandemic churn,” Saunders said in a research note.
Dick’s now expects to make between $ 12.88 and $ 13.06 per share on sales between $ 12.12 and $ 12.19 billion. After making adjustments to spending related to Covid-19, Dick’s said it would make between $ 14.60 and $ 14.80 per share.
The company previously estimated adjusted earnings for the full year at $ 12.45 to $ 12.95 per share on revenue of $ 11.52 to $ 11.72 billion.
Analysts had expected adjusted earnings per share for fiscal 2021 of $ 13.13 on sales of $ 11.84 billion.
Dick’s market value is approximately $ 11.2 billion, including Tuesday’s losses.
Find the full press release on Dick’s Sporting Goods results here.