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Headquartered in Pittsburgh, PA, Dick's Sporting Goods (NYSE:DKS) is a full-line sporting goods retailer offering athletic shoes, apparel, accessories and a broad selection of outdoor and athletic equipment.

The company operates 566 locations across the country. It also owns Golf Galaxy, Field & Stream and True Runner specialty stores.

Disappointing First Quarter Results and Weak Guidance

On May 20, DKS reported its first quarter results. Net income for the quarter was $0.50 per share, below the Zacks Consensus Estimate of $0.53 per share, as well as short of company's guidance of between $0.51 and $0.53 per share.

Consolidated same store sales increased 1.5%, much weaker compared to the company's guidance of an approximate 3% to 4% increase. Golf and hunting segments faced significant headwinds during the quarter.

Per management, "after a very challenging first quarter in golf last year, we expected some further headwinds and only modest improvement but instead we saw a continued significant decline. In the case of hunting, we planned the business down based on last year's catalysts, but it was even weaker than expected."

The company expects its golf business to perform poorly throughout fiscal 2014, while the hunting business is expected to stabilize only by year-end.

The company now expects earnings of approximately $2.70 to $2.85 per share for the full year, down from their previous guidance of $3.03 to $3.08 per share. They expect same store sales to increase 1% to 3% for the year compared to previous expectations of a 3% to 4% increase.

Downward Revisions

After weaker than expected results and guidance, analysts have revised their quarterly and annual estimates downwards. Zacks Consensus Estimates for fiscal years 2014 and 2015 are now $2.77 and $3.16 per share, down from $3.09 and $3.59 per share, 60 days ago.

Negative revisions sent DKS to Zacks Rank No. 5 (Strong Sell) on May 24.

Better Play in the Industry?

Retail (Misc) industry is currently ranked 206 out of 265 (bottom 22%). There is no Zacks Rank No. 1 (Strong Buy) stock in the industry as of now. Investors seeking exposure to the industry could look at Build-A-Bear Workshop (NYSE:BBW), a Zacks Rank No. 2 (Buy) stock. BBW delivered a huge positive surprise of 287.5% for Q1 and is expected to show excellent EPS growth going forward.

The Bottom Line

The company could be a good long-term growth play but its near-term outlook remains cloudy with sluggish sales and highly promotional retail environment hurting the bottom-line.

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Source: Zacks' Bear Of The Day: Dick's Sporting Goods