Dick's Sporting Goods Inc. (DKS) is expected to report third quarter results on Monday, November 11, 2013, according to Yahoo finance. DKS investor's relations site makes no mention of a pending announcement, but Dicks typically reports in the second week of November. So, iStock's expects the sporting goods store to report by the end of next week.
Wall Street anticipates that the specialty retailer will make a profit of $0.39 per share for the quarter. iStock expects DKS to hit Wall Street's consensus number. The iEstimate is $0.39, too.
With the help of more than 11,000 employees, Dick's Sporting Goods operates as a sports and fitness retailer primarily in the Eastern United States. The company provides hardlines, including sporting goods equipment, fitness equipment, golf equipment, and hunting and fishing gear products; apparel; and footwear products.
The services company has struggled to meet analysts' consensus estimate in the last three quarters, missing twice and hitting the target once for the last three quarterly checkups. Prior to their recent struggles, Dick's had no problems handling Wall Street's forecast, delivering bullish surprises 12 of 13 announcements.
While, until recently, actual results normally bested guesstimates, Dick's stock tends to be an underperformer in the days surrounding EPS announcements. Shares backpedaled nine of the last 16 results; falling by an average of 6.78% with a range of -1.30% to -15.8%.
The lucky seven EPS-driven pops were accompanied by six bullish surprises and the lone tie. Typically, the stock gained 4.96% maxing out at 10.3%.
Q3's announcement has a little better track-record than the rest of the quarters. Investors were rewarded with gains three of the last four November announcements. The funny thing is the Topaz month owns the best and worst performances.
According to the US Commerce Department's ADVANCE MONTHLY SALES FOR RETAIL AND FOOD SERVICES SEPTEMBER 2013, Sporting goods, hobby, book & music s! tores sales increased 0.8% versus Q2 2013 and 2.8% compared to last year's third quarter. However, the current consensus is less than last year's EPS of $0.40. If DKS' earnings keep pace with the Commerce Department's numbers, then profit per share will come in at $0.41.
Costs could be up in the quarter as Dick's aggressively opened new stores during the quarter – 31 our count, which does not include specialty stores such as Field & Stream or remodels.
We see evidence of rising costs associated with new stores in last quarter's announcement as Pre-opening expenses were up 132%. However, the line-item remains a small fraction of total revenue, but still enough to account for $0.04 per share. Otherwise, management held the line on other costs and expenses.
Overall: Overall retail trends suggest Dick's Sporting Goods Inc. (DKS) should be able to meet the street view and the iEstimate; however, aggressive expansion could take a bite out the bottom line, which puts risk to the downside for the bottom line.
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