DICK'S Sporting Expansion Update: 6 Stores in the Offing
DICK'S Sporting Goods Inc.’s (DKS) store expansion continues unabated. The company announced opening of 6 new stores on Nov 7 with celebrations of the launch continuing over the weekend.
The stores will be located in King of Prussia, PA; LaCrosse, WI; Frederick and Easton, MD; Wayne NJ; and Naples, FL.
The store offerings will include over 40 suitable in-store services provided by DICK'S certified PROS in sports and outlook specialties including Golf, Biking and Fishing. Moreover, the new location will house Under Armour, Inc. (UA) and Nike, Inc. (NKE) shops. It will also include other athletic clothing and footwear brands along with the latest equipment for team sports, fitness, camping, hunting and fishing.
In order to attract customers to its new stores, DICK’S Sporting announced a range of lucrative giveaways during the celebration period.
The company will distribute free Reebok Play Dry T-Shirts to the first 100 people in queue on the opening day. Also, the early birds will get an opportunity to open the DICK'S Sporting Goods Gift Locker on all three days. Moreover, on Saturday and Sunday, it plans to give away free Mystery Gift Cards worth $5–$500 to the first 100 adults in queue.
Apart from DICK’S Sporting, another company which has been ramping up store expansion is DSW Inc. (DSW). The company recently announced four new stores located in Eau Claire, WI; California, MD; West Palm Beach, FL; and Pleasant Hill, CA. After a dull first half, the company picked up pace and announced more than 15 new openings since September.
DICK'S Sporting faces lower merchandise margins along with higher shipping and operating expenses that has negatively impacted quarterly performances. Moreover, persistent weakness in the golf and hunting businesses is adding to the woes. The company is trying hard to revive profitability.
Apart from store expansion, the company is also focusing on in-store remodeling efforts, launch of shop-in-shop facilities and recruitment of more competent sales personnel to boost its top line. Furthermore, the company is aggressively enhancing its eCommerce capabilities to increase sales as well as market share in online retailing.
Though its initiatives are in the right direction, these will take sometime to result in solid financial numbers. As a result, DICK'S Sporting is a Zacks Rank #4 (Sell) stock.
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