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Why DICK'S Sporting (DKS) Looks Poised for Earnings Beat in Q2
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DICK’S Sporting Goods Inc. (DKS - Free Report) is expected to register year-over-year sales growth when it releases second-quarter fiscal 2021 results on Aug 25. The Zacks Consensus Estimate for quarterly revenues is pegged at $2.81 billion, indicating an improvement of 3.5% from the year-ago quarter’s reported number.
The consensus estimate for fiscal second-quarter earnings currently stands at $2.65, which suggests a decline of 17.5% from the year-ago quarter’s reported number. However, the consensus mark has been revised upward by 1.9% in the past 30 days.
In the last reported quarter, the company’s earnings beat the Zacks Consensus Estimate by 264.4%. It has delivered an earnings surprise of 136.8%, on average, in the trailing four quarters.
DICK’S Sporting has been benefiting from favorable customer demand, particularly in golf, outdoor activities, home fitness and active lifestyle categories. A solid product portfolio, advanced technologies and omni-channel capabilities have also been aiding the quarterly performance. The company has been witnessing strong in-store and online sales, which is likely to have continued to aid its top-line performance in the fiscal second quarter.
DICK’S Sporting’s consolidated same-store sales (comps) have been robust for a while on higher average ticket as well as strength in hardlines, apparel and footwear categories. On its last reported quarter’s earnings call, management noted that a strong business momentum will continue throughout fiscal 2021.
The company’s fiscal second-quarter results are expected to have benefited from its investments in e-commerce, technology, store payroll, Team Sports and private brands. It has been on track to build the best omni-channel experience for athletes by strengthening its store network and expanding the e-commerce presence. This along with improved omni-channel capabilities, including curbside pickup services and BOPIS, has been aided digital sales.
The company’s earnings for the fiscal second quarter are expected to reflect gains from gross margin rate expansion and lower costs. Strong merchandise margins, stemming from reduced promotions and robust sales growth are likely to have boosted gross margin. Reduced fixed costs are also expected to have aided margins. The company has been witnessing a lower SG&A expense rate due to operating leverage.
It predicted year-over-year comp and bottom-line growth for the fiscal first quarter. It anticipated the team sports business to be a tailwind. Its golf business across both DICK'S and Golf Galaxy is also expected to have been impressive.
However, the company continues to witness pandemic-related cost pressures. The persistence of additional costs related to the ongoing COVID-19 is likely to have weighed on its bottom line to some extent in the fiscal second quarter.
What the Zacks Model Unveils
Our proven model predicts an earnings beat for DICK’S Sporting this reporting cycle. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
DICK’S Sporting currently has a Zacks Rank #2 and an Earnings ESP of +1.66%.
More Stocks With Favorable Combination
Here are a few other companies worth considering from the same sector as our model shows that these too have the right combination of elements to beat on earnings:
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Why DICK'S Sporting (DKS) Looks Poised for Earnings Beat in Q2
DICK’S Sporting Goods Inc. (DKS - Free Report) is expected to register year-over-year sales growth when it releases second-quarter fiscal 2021 results on Aug 25. The Zacks Consensus Estimate for quarterly revenues is pegged at $2.81 billion, indicating an improvement of 3.5% from the year-ago quarter’s reported number.
The consensus estimate for fiscal second-quarter earnings currently stands at $2.65, which suggests a decline of 17.5% from the year-ago quarter’s reported number. However, the consensus mark has been revised upward by 1.9% in the past 30 days.
In the last reported quarter, the company’s earnings beat the Zacks Consensus Estimate by 264.4%. It has delivered an earnings surprise of 136.8%, on average, in the trailing four quarters.
DICKS Sporting Goods, Inc. Price and EPS Surprise
DICKS Sporting Goods, Inc. price-eps-surprise | DICKS Sporting Goods, Inc. Quote
Key Factors to Note
DICK’S Sporting has been benefiting from favorable customer demand, particularly in golf, outdoor activities, home fitness and active lifestyle categories. A solid product portfolio, advanced technologies and omni-channel capabilities have also been aiding the quarterly performance. The company has been witnessing strong in-store and online sales, which is likely to have continued to aid its top-line performance in the fiscal second quarter.
DICK’S Sporting’s consolidated same-store sales (comps) have been robust for a while on higher average ticket as well as strength in hardlines, apparel and footwear categories. On its last reported quarter’s earnings call, management noted that a strong business momentum will continue throughout fiscal 2021.
The company’s fiscal second-quarter results are expected to have benefited from its investments in e-commerce, technology, store payroll, Team Sports and private brands. It has been on track to build the best omni-channel experience for athletes by strengthening its store network and expanding the e-commerce presence. This along with improved omni-channel capabilities, including curbside pickup services and BOPIS, has been aided digital sales.
The company’s earnings for the fiscal second quarter are expected to reflect gains from gross margin rate expansion and lower costs. Strong merchandise margins, stemming from reduced promotions and robust sales growth are likely to have boosted gross margin. Reduced fixed costs are also expected to have aided margins. The company has been witnessing a lower SG&A expense rate due to operating leverage.
It predicted year-over-year comp and bottom-line growth for the fiscal first quarter. It anticipated the team sports business to be a tailwind. Its golf business across both DICK'S and Golf Galaxy is also expected to have been impressive.
However, the company continues to witness pandemic-related cost pressures. The persistence of additional costs related to the ongoing COVID-19 is likely to have weighed on its bottom line to some extent in the fiscal second quarter.
What the Zacks Model Unveils
Our proven model predicts an earnings beat for DICK’S Sporting this reporting cycle. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
DICK’S Sporting currently has a Zacks Rank #2 and an Earnings ESP of +1.66%.
More Stocks With Favorable Combination
Here are a few other companies worth considering from the same sector as our model shows that these too have the right combination of elements to beat on earnings:
The Gap, Inc. (GPS - Free Report) has an Earnings ESP of +22.29% and it currently sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Burlington Stores, Inc. (BURL - Free Report) has an Earnings ESP of +20.61% and it flaunts a Zacks Rank #1 at present.
Urban Outfitters, Inc. (URBN - Free Report) currently has an Earnings ESP of +4.00% and a Zacks Rank #2.