U.S. Markets open in 5 hrs 54 mins
  • S&P Futures

    3,923.75
    +20.00 (+0.51%)
     
  • Dow Futures

    31,581.00
    +160.00 (+0.51%)
     
  • Nasdaq Futures

    12,105.00
    +64.50 (+0.54%)
     
  • Russell 2000 Futures

    1,782.60
    +12.80 (+0.72%)
     
  • Crude Oil

    111.35
    +1.78 (+1.62%)
     
  • Gold

    1,828.20
    +3.40 (+0.19%)
     
  • Silver

    21.30
    +0.13 (+0.60%)
     
  • EUR/USD

    1.0592
    +0.0006 (+0.0530%)
     
  • 10-Yr Bond

    3.1940
    0.0000 (0.00%)
     
  • Vix

    26.99
    -0.24 (-0.88%)
     
  • GBP/USD

    1.2264
    -0.0006 (-0.0515%)
     
  • USD/JPY

    135.7520
    +0.3060 (+0.2259%)
     
  • BTC-USD

    20,877.24
    -475.42 (-2.23%)
     
  • CMC Crypto 200

    455.52
    -6.28 (-1.36%)
     
  • FTSE 100

    7,318.59
    +60.27 (+0.83%)
     
  • Nikkei 225

    27,049.47
    +178.17 (+0.66%)
     

DICK'S Sporting (DKS) Q1 Earnings and Sales Beat Estimates

  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
·4 min read
In this article:
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.

DICK'S Sporting Goods, Inc. DKS posted impressive first-quarter fiscal 2022 results, wherein both the top and the bottom line surpassed the Zacks Consensus Estimate. However, both metrics declined year over year. On a two-year basis, DKS witnessed growth, driven by strength in its core strategies.

Shares of DKS have declined 31.8% year to date, outperforming the industry’s 32.7% decrease.

Quarter in Detail

For the fiscal first quarter, adjusted earnings were $2.85 per share, down 25% from the prior-year figure of $3.79. This can be attributable to drab sales and dismal gross margins for the reported quarter. However, the figure surpassed the Zacks Consensus Estimate of $2.43 per share.

Net sales of $2,700 million declined 7.5% year over year but surpassed the Zacks Consensus Estimate of $2,634 million. However, net sales advanced 41% from the fourth-quarter fiscal 2019 reading on sales normalization in certain categories.

Consolidated same-store sales (comps) declined 8.4% from comps growth of 117.1%.

The gross margin contracted 83 basis points (bps) year over year to 36.5% for the quarter under review due to higher supply-chain-related costs and rising fixed occupancy costs, which were somewhat offset by improved merchandise margins. SG&A expenses of 22.8%, as a percentage of sales, contracted 195 bps year over year due to weak sales.

Zacks Investment Research
Zacks Investment Research


Image Source: Zacks Investment Research

Financial Aspects

This currently Zacks Rank #3 (Hold) player ended the reported quarter with cash and cash equivalents of $2,251.3 million, no borrowings under the $1.6-billion revolving credit facility and a total stockholders' equity of $2,194.6 million. Total inventory rose 40% year over year as of Apr 30, 2022.

In the reported quarter, total capital expenditure amounted to $73.8 million. DICK’S Sporting still projects capital expenditure of $400-$425 million on a gross basis for fiscal 2022.

DKS approved its quarterly dividend of 48.75 cents per share on common stock and Class B common stock, which is likely to be paid out on Jun 24 to its shareholders of record as of Jun 10. DICK’S Sporting paid out more than $46.1 million in the form of dividends and repurchased shares worth $42 million in the quarter. Going ahead, management intends to buy back at least $300 million of shares in fiscal 2022.

DICK'S Sporting Goods, Inc. Price, Consensus and EPS Surprise

DICK'S Sporting Goods, Inc. Price, Consensus and EPS Surprise
DICK'S Sporting Goods, Inc. Price, Consensus and EPS Surprise

DICK'S Sporting Goods, Inc. price-consensus-eps-surprise-chart | DICK'S Sporting Goods, Inc. Quote

Guidance

Management slashed its fiscal 2022 view to reflect the ongoing macroeconomic environment, supply-chain conditions and the current geopolitical situation. DKS envisions adjusted earnings of $9.15-$11.70 for fiscal 2022, comparing unfavorably with the prior view of $11.70-$13.10. Also, comps are anticipated to decline 8-2%, down from the earlier guided view of a decline of 4% to flat. However, management expects sales to grow roughly 35% on a two-year basis.

Stocks to Consider

Here are three better-ranked stocks to consider, namely Boot Barn Holdings BOOT, Dillard’s DDS and Kroger KR.

Boot Barn, which provides western and work-related footwear, apparel and accessories, currently sports a Zacks Rank #1 (Strong Buy). BOOT has a trailing four-quarter earnings surprise of 25.2%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Boot Barn’s current financial-year sales and EPS suggests growth of 17% and 4.4%, respectively, from the corresponding year-ago period’s reported figures. BOOT has an expected EPS growth rate of 20% for three-five years.

Dillard’s operates as a departmental store chain featuring fashion apparel and home furnishings. DDS presently sports a Zacks Rank of 1. DDS has a trailing four-quarter earnings surprise of 224.1%, on average.

The Zacks Consensus Estimate for Dillard’s current financial-year sales suggests growth of 6.1%, while the same for EPS indicates a decline of 33.9% from the corresponding year-ago period’s reported numbers. DDS has an expected EPS growth rate of 12.6% for three-five years.

Kroger, which provides an array of goods ranging from household essentials, groceries and electronics to toys and apparel for men, women and kids, currently carries a Zacks Rank #2 (Buy). KR has a trailing four-quarter earnings surprise of 22.1%, on average.

The Zacks Consensus Estimate for Kroger’s current financial-year sales and EPS suggests growth of 3.2% and 4.1%, respectively, from the corresponding year-ago period’s reported figures. KR has an expected EPS growth rate of 9.9% for three-five years.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Dillard's, Inc. (DDS) : Free Stock Analysis Report
 
The Kroger Co. (KR) : Free Stock Analysis Report
 
DICK'S Sporting Goods, Inc. (DKS) : Free Stock Analysis Report
 
Boot Barn Holdings, Inc. (BOOT) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.