Sporting goods retailer, Dick's Sporting Goods Inc. recently announced that it would inaugurate five new stores on October 31 at different locations across the United States. The latest announcements include the opening of one store in Monroe at Pecanland Mall and four stores in Oklahoma City at Shops at Quail Springs, Fritts Farm, Westgate Marketplace and Town Center Plaza.
Earlier this month, the company announced the debut of twelve new stores in various parts of the United States. Additionally, in September, it opened ten stores at different locations across the country. The opening of stores remains in tune with the company’s previously announced plan of inaugurating 21 stores in the third quarter and relocating 3 existing stores.
For fiscal 2012, the company plans to open approximately 38 Dick's Sporting Goods stores. Moreover, it plans to relocate about five existing stores and one Golf Galaxy store in 2012. In the long-term, Dick's Sporting aims to open 400 additional stores, targeting a total store count of about 900 in the United States.
As of September 21, 2012, Dick's Sporting operated 500 stores in 44 states. Additionally, the company operates 81 Golf Galaxy stores in 30 states.
We believe that Dick's Sporting continues to progress well with its growth initiatives, which include expanding its store base and bringing in technological advancements to better serve its patrons. The company’s extensive network of stores helps it add market share while boosting its top line and providing a competitive edge over its rivals, including Foot Locker Inc. and Wal-Mart Stores Inc. .
Apart from expanding its store base, Dick’s Sporting is also focusing on buyers’ needs to generate growth opportunities that will augment sales. The company aims at providing top-notch shopping experience to its customers and has introduced a new mobile application for iPhones and Android Smartphones in the last month.
We believe that the company’s strategic measures of solidifying its store base and using technology to provide better customer services will enhance its relationship with clients, help attract and retain customers and also promote its offerings.
Currently, Dick’s has a Zacks #2 Rank, which translates to a short-term Buy rating. However, we remain slightly cautious on the stock due to sluggish economic recovery along with high household debt and unemployment level, which may restrain consumers spending on sporting goods items. Therefore, we are upholding our long-term Neutral recommendation, waiting to see further catalysts before becoming more positive on the stock.