• Business

  ****’s Sporting Goods shares jump after retailer hikes outlook as it bounces back from theft woes

  Posted by Business on November 21, 2023 at 11:59 am

  

  • ****’s Sporting Goods raised its full-year outlook after slashing it in the prior quarter over theft concerns.
  • The athletic goods retailer, known for its wide expanse of branded products and sports equipment, said it’s “excited” for the holiday shopping season.
  • In the prior quarter, ****’s shocked investors when it blamed a 23% drop in profits on theft and markdowns.

  A ****’s Sporting Goods store stands in Staten Island on March 09, 2022 in New York City.

  Spencer Platt | Getty Images

  Shrink who? 

  Sales and profits at ****’s Sporting Goods bounced back in the third quarter, leading the retailer to raise its full-year guidance Tuesday after it shocked investors earlier this year when it slashed its outlook over theft concerns.

  ****’s beat Wall Street’s estimates on the top and bottom lines for the period. In a news release, the company said it’s “excited” for the holiday season after seeing “strong” back-to-school sales. 

  Shares jumped more than 8% in premarket trading after the news.

  Here’s how the athletic goods retailer performed during its fiscal third quarter compared with what Wall Street was anticipating, based on a survey of analysts by LSEG, formerly known as Refinitiv:

  • Earnings per share: $2.85, adjusted, vs. $2.44 expected
  • Revenue: $3.04 billion vs. $2.94 billion expected

  The company’s reported net income for the three-month period that ended Oct. 28 was $201 million, or $2.39 per share, compared with $228 million, or $2.45 per share, a year earlier. Excluding one time items, ****’s saw earnings per share of $2.85. 

  Sales rose to $3.04 billion, up about 2.8% from $2.96 billion a year earlier.

  For the full year, the company now expects earnings per share to be between $11.45 and $12.05, compared with the $11.27 to $12.39 range that analysts had expected, according to LSEG. ****’s raised its guidance from a prior range of $11.33 to $12.13. But it still falls below the original outlook the company set earlier this year, when it said it expected earnings of $12.90 to $13.80.

  ****’s also raised its comparable sales outlook slightly and expects them to be up between 0.5% and 2%, compared to a previous range of flat to up 2%. Much of that range would top the 0.7% increase that analysts had expected, according to StreetAccount. 

  ****’s didn’t immediately share further details on its holiday forecast. But since it only slightly raised its same-store sales outlook despite the strong third-quarter beats, ****’s appears somewhat cautious entering the holiday season, mirroring sentiment from other retailers that are concerned demand will be tepid.

  When ****’s reported fiscal second-quarter earnings over the summer, its stock plummeted 24% after it blamed theft and aggressive markdowns for a staggering 23% drop in profits. Upticks in “organized retail crime and theft in general” – plus aggressive markdowns to clear out excess inventory – contributed to the profit loss. The company said it would impact its guidance for the year. 

  While earnings guidance at ****’s is still below the range it originally set for itself, strong sales during the back-to-school months led the company to raise its outlook and strike a positive tone for the crucial holiday shopping season. 

  “We are pleased with our third quarter results. With our best-in-class athlete experience and differentiated assortment, we had a very strong back-to-school season and continued to gain market share as consumers prioritize ****’S Sporting Goods to meet their needs,” President and CEO Lauren Hobart said in a news release. “As a result of our strong Q3 performance, we are raising our full year outlook, which balances the confidence we have in our key strategies with an acknowledgment of the uncertain macroeconomic environment. We’re excited for the upcoming holiday season and the product, service and experience we are providing to our athletes.”

  Read the full earnings release here.

  Business replied 7 months, 2 weeks ago 1 Member · 0 Replies

  • Business - News
• 0 Replies

Log In to Reply