Another quarter and another solid report from Dick's Sporting Goods (NYSE:DKS). DKS has to be one of the best run retailers in the world. The company continually takes market share in a fragmented sporting goods market that has mainly weak competitors. This trend should continue for years.
For Q4, DKS reported earnings of $0.76 after forecasting roughly $0.70 on the Q3 report. The company achieves this growth mostly by seeing 9% comp sales growth gained mostly from an 8.6% increase at Dick's Sporting Goods stores and a whopping 36% increase in e-commerce. As it continues to gain market share, it's possible that the e-commerce site becomes the go to destination with a preference for in store returns to a superior retailer.
DKS forecast $1.90 for 2011 and 3% comp sales. Based on the continual UPOD (under promise and over deliver) of this company, Stone Fox would expect DKS to make at least $2. At nearly $40 they have a PE of roughly 20 making them fairly valued. No reason to be aggressive buying at these levels, but a core holding could easily garner above market returns.
Highlights via Dick's PR:
- Consolidated non-GAAP earnings per diluted share increased by 36% to $0.76 in the fourth quarter of 2010 from consolidated earnings per diluted share of $0.56 in the fourth quarter of 2009
- Consolidated same store sales increased 9.4% in the fourth quarter of 2010
- Full year consolidated non-GAAP earnings per diluted share increased 36% to $1.63 from 2009 consolidated non-GAAP earnings per diluted share of $1.20