Once again Dick’s Sporting Goods (DKS) has reported another excellent quarter. The sporting goods and apparel retailer reported EPS of 22 cents on net sales of $1.079 billion for its fiscal 3rd quarter. This compares to Wall Street consensus estimates of EPS of 17 cents and net sales of $1.04 billion. In the prior year’s quarter Dick’s Sporting Goods earned 16 cents on net sales of $990 million.
Same store sales increased by 5.1% which was attribute to both its core Dick’s Sporting Goods Stores (+3.8%) and Golf Galaxy (+2.4%). I am very pleased to see the beginnings of a turnaround at Golf Galaxy, which so far since its acquisition by Dick’s Sporting Goods, has been somewhat of a disappointment. Direct-to-consumer sales in its ecommerce unit surged 82.4%
The company also increased its full year guidance. Now management expects to earn $1.56 to $1.58. This is an approximate increase of nearly 31% versus 2009 earnings per share of $1.20.
Dick’s Sporting Goods is a best in class sporting goods and apparel retailer. The company carries all major brands including Nike (NIKE) and Under Armour (UA). I have owned stock in Dick’s Sporting Goods ever since its IPO and continue to hold those original shares (which have split several times) and stock purchased for our LakeView Asset Management, LLC customers ever since. A continued improvement in consumer behavior, new store openings and expansion of ecommerce sales will propel Dick’s Sporting Good’s even higher.
Looking ahead to 2011, the company can earn as much as $1.90 per share. As a result, a price target of at least $40 is quite reasonable for Dick’s Sporting Goods.
At the time of this Blog entry Scott Rothbort, his family and or clients of LakeView Asset Management, LLC owned shares of Dick's Sporting Goods (DKS) --- although positions can change at any time.
For more information on investing with LakeView Asset Management, LLC please visit the company's website
Posted By Scott Rothbort at November 16, 2010