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Dick's Sporting Goods (DKS) Outpaces Stock Market Gains: What You Should Know

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Zacks Equity Research
·3 min read
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Dick's Sporting Goods (DKS) closed the most recent trading day at $67.78, moving +0.92% from the previous trading session. This move outpaced the S&P 500's daily gain of 0.03%. At the same time, the Dow lost 0.04%, and the tech-heavy Nasdaq gained 0.55%.

Heading into today, shares of the sporting goods retailer had gained 20.36% over the past month, outpacing the Retail-Wholesale sector's gain of 1.69% and the S&P 500's gain of 3.99% in that time.

DKS will be looking to display strength as it nears its next earnings release. In that report, analysts expect DKS to post earnings of $2.18 per share. This would mark year-over-year growth of 65.15%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $3.01 billion, up 15.43% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $5.81 per share and revenue of $9.46 billion, which would represent changes of +57.45% and +8.14%, respectively, from the prior year.

Any recent changes to analyst estimates for DKS should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. DKS currently has a Zacks Rank of #1 (Strong Buy).

In terms of valuation, DKS is currently trading at a Forward P/E ratio of 11.56. This represents a premium compared to its industry's average Forward P/E of 11.33.

Meanwhile, DKS's PEG ratio is currently 2.05. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Retail - Miscellaneous industry currently had an average PEG ratio of 1.6 as of yesterday's close.

The Retail - Miscellaneous industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 37, putting it in the top 15% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow DKS in the coming trading sessions, be sure to utilize Zacks.com.


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