Dick's Sporting Goods shares rise on analyst optimism ahead of results

On Monday, Dick's Sporting Goods, Inc. (NYSE: NYSE:DKS ) experienced a 4% increase in its share price ahead of the announcement of its third-quarter fiscal 2024 results. The company is scheduled to release these results before the market opens on Tuesday, November 26th. Analysts from various firms have reiterated their positive stance on the retailer's stock, with expectations of strong performance.

Williams Trading has maintained a Buy rating and a $250.00 price target on Dick's Sporting Goods. The firm anticipates the company's third-quarter results to surpass consensus estimates, citing effective strategic promotions, market share gains, and improvements in women's footwear and apparel sales. The analyst from Williams Trading highlighted that despite concerns regarding the optimization of new store concepts, Dick's Sporting Goods' better product allocations and execution are resonating with consumers and securing the retailer's position in the market.

TD Cowen also reiterated a Buy rating with a higher price target of $270.00, suggesting that Dick's management might raise the lower end of the full-year earnings per share (EPS) guidance due to strength across various product lines. The firm's valuation is based on a discounted cash flow model, reflecting a premium to the historical price-to-earnings multiple given the company's potential for a durable low double-digit EPS compound annual growth rate and high returns on capital from new investments.

Ahead of the earnings report, Bloomberg provided consensus estimates, predicting an adjusted EPS of $2.68 and net sales of $3.03 billion for the third quarter. The estimates also forecast a 2.5% increase in comparable store sales. For the full year 2025, the EPS estimate stands at $13.91 with a 3.37% rise in comparable sales.

Additional analyst commentary from Citi suggests a potential increase in the full-year 2024 EPS guidance, while Wedbush expects a mostly in-line quarter. Concerns were raised about the impact of higher costs associated with new store openings and the potential difficulty in navigating tariffs under the next round of proposed tariffs.

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Source: Investing.com