Dick’s Sporting Goods (DKS) outpaces stock market gains: what you need to know

IIn the last trading session, Dick’s Sporting Goods (DKS) closed at $101.23, marking a +1.5% move from the previous day. That move topped the S&P 500’s daily gain of 0.48%. Meanwhile, the Dow Jones gained 0.2% and the tech-heavy Nasdaq lost 0.01%.

As of today, shares of the sporting goods retailer are down 2.83% over the past month. At the same time, the Retail-Wholesale sector lost 10.21%, while the S&P 500 lost 8.48%.

Dick’s Sporting Goods will look to show strength ahead of its next earnings release, which is expected on May 25, 2022. In the report, analysts expect Dick’s Sporting Goods to post a profit of 2 $.42 per share. That would mark a 36.15% year-over-year decline. Meanwhile, our latest consensus estimate calls for revenue of $2.63 billion, down 10.01% from the prior year quarter.

Looking to the full year, our Zacks consensus estimates suggest analysts are expecting earnings of $12.62 per share and revenue of $12.15 billion. These totals would mark changes of -19.62% and -1.19%, respectively, from last year.

Any recent changes in analyst estimates for Dick’s Sporting Goods should also be noted by investors. These revisions generally reflect the latest short-term trading trends, which may change frequently. Thus, positive revisions to estimates reflect analysts’ optimism about the company’s business and profitability.

Our research shows that these estimate changes are directly correlated to short-term stock prices. Investors can take advantage of this by using the Zacks ranking. This model accounts for these estimation changes and provides a simple and actionable scoring system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive track record of outperformance verified by external audits, with #1 stocks generating an average annual return of +25% since 1988 Zacks Consensus’ EPS estimate fell 0.21% over the past month. Dick’s Sporting Goods currently has a Zacks rank of #3 (Hold).

In terms of valuation, Dick’s Sporting Goods is currently trading at a forward P/E ratio of 7.9. For comparison, its industry has an average PER of 12.1, meaning Dick’s Sporting Goods trades at a discount to the group.

Investors should also note that DKS has a PEG ratio of 1.58 at this time. The PEG ratio is similar to the widely used P/E ratio, but this measure also takes into account the company’s expected earnings growth rate. Retail – Miscellaneous stocks hold, on average, a PEG ratio of 1.28 based on yesterday’s closing prices.

The Retail – Miscellaneous industry is part of the Retail – Wholesale sector. This group has a Zacks industry ranking of 81, which places it in the top 33% of over 250 industries.

The Zacks Industry Ranking assesses the strength of our individual industry groups by measuring the average Zacks Ranking of individual stocks within the groups. Our research shows that the top 50% of industries outperform the bottom half by a factor of 2 to 1.

Be sure to track all of these stock movement metrics, and more, at Zacks.com.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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