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DICK'S Sporting (DKS) Q4 Earnings & Sales Beat on High Demand
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DICK'S Sporting Goods, Inc. (DKS - Free Report) posted impressive fourth-quarter fiscal 2021 results, wherein both top and bottom lines surpassed the Zacks Consensus Estimate and also improved year over year. The results gained from customer demand and improved product assortment, which led to strong sales and improved merchandise margin. The company also remains optimistic about the performance of DICK'S House of Sports, Golf Galaxy Performance Center and Public Lands stores. However, supply-chain issues, inflation and surging oil prices remain concerning.
We note that shares of this Zacks Rank #2 (Buy) company have risen 50.3% in the past year against the industry’s 24.1% decline.
Quarter in Detail
For the fiscal fourth quarter, adjusted earnings were $3.64 per share, up 50% from the prior-year figure of $2.43. The figure surpassed the Zacks Consensus Estimate of $3.54 per share. The uptick can be attributable to solid sales and improved gross margins for the reported quarter. Adjusted earnings also surged 176% from fourth-quarter fiscal 2019.
Net sales of $3,352 million grew 7.3% year over year and beat the Zacks Consensus Estimate of $3,305 million. The increase can be attributable to improved store sales and robust comps. Net sales advanced 28.5% from fourth-quarter fiscal 2019. Strength in key categories, and growth in both average ticket and transactions aided sales.
Consolidated same-store sales (comps) advanced 5.9% compared with comps growth of 19.3% and 5.3% in fourth-quarter fiscal 2020 and fourth-quarter fiscal 2019, respectively. Growth in team sports, apparel and footwear remained upsides.
Store comps also rose 14% year over year, while the metric advanced 24% on a two-year basis. E-commerce sales declined 11% year over year, while it increased 39% on a two-year basis. E-commerce accounted for nearly 27% of net sales for the reported quarter, up from 25% in fourth-quarter fiscal 2019 but down from roughly 32% from fourth-quarter fiscal 2020.
The gross margin expanded 391 basis points (bps) year over year to 37.6% for the quarter under review, driven by robust sales and merchandise margins. Adjusted gross margins expanded 898 bps on a two-year basis. SG&A expenses of 23.4%, as a percentage of sales, contracted 97 bps year over year and 91 bps from fourth-quarter fiscal 2019.
Image Source: Zacks Investment Research
Financial Aspects
DICK'S Sporting ended the reported quarter with cash and cash equivalents of $2,643.2 million, no borrowings under the $1.9-billion revolving credit facility, and total stockholders' equity of $2,101.6 million. Total inventory rose 17.6% year over year as of Jan 29, 2022.
In fiscal 2021, total capital expenditure amounted to $308 million. The company now projects capital expenditure of $400-$425 million on a gross basis for fiscal 2022.
The company hiked its quarterly dividend by 11% to 48.75 cents per share on common stock and Class B common stock, which is likely to be paid out on Mar 25 to shareholders of record as of Mar 18. DICK’S Sporting paid out more than $603 million in the form of dividends in fiscal 2021.
It repurchased 6.78 million shares worth $750.3 million in the fiscal fourth quarter. Following this, the company approved a new share repurchase program, valid for five years, of up to $2 billion. As of Jan 29, 2022, it has $1.855 billion remaining under its existing share repurchase plan. Going ahead, DKS expects to repurchase at least $200 million of its common shares in fiscal 2022.
DICK'S Sporting Goods, Inc. Price, Consensus and EPS Surprise
Management issued the fiscal 2022 view. The company envisions adjusted earnings of $11.70-$13.10 fiscal 2022, which compares unfavorably with last year’s reported figure of $15.70. Also, comps are anticipated to be negative 4% to flat, compared with 26.5% and 9.9% comps growth reported in fiscal 2021 and 2020, respectively. The outlook also includes the impacts of elevated freight costs, which are likely to persist in 2022.
The Zacks Consensus Estimate for Nordstrom’s current financial-year sales and EPS suggests growth of 5.7% and 180%, respectively, from the year-ago period’s reported numbers. JWN has an expected EPS growth rate of 6% for three-five years.
Capri Holdings currently flaunts a Zacks Rank #2. The company has a trailing four-quarter earnings surprise of 1,018.2%, on average.
The Zacks Consensus Estimate for Capri Holdings’ current financial-year sales and EPS suggests growth of 37.1% and 215.8%, respectively, from the year-ago period’s reported figures. CPRI has an expected EPS growth rate of 53.9% for three-five years.
Tractor Supply currently carries a Zacks Rank #2. The company has a trailing four-quarter earnings surprise of 22%, on average.
The Zacks Consensus Estimate for Tractor Supply’s current financial-year sales and EPS suggests growth of 8.2% and 8%, respectively, from the year-ago period’s reported figures. TSCO has an expected EPS growth rate of 9.8% for three-five years.
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DICK'S Sporting (DKS) Q4 Earnings & Sales Beat on High Demand
DICK'S Sporting Goods, Inc. (DKS - Free Report) posted impressive fourth-quarter fiscal 2021 results, wherein both top and bottom lines surpassed the Zacks Consensus Estimate and also improved year over year. The results gained from customer demand and improved product assortment, which led to strong sales and improved merchandise margin. The company also remains optimistic about the performance of DICK'S House of Sports, Golf Galaxy Performance Center and Public Lands stores. However, supply-chain issues, inflation and surging oil prices remain concerning.
We note that shares of this Zacks Rank #2 (Buy) company have risen 50.3% in the past year against the industry’s 24.1% decline.
Quarter in Detail
For the fiscal fourth quarter, adjusted earnings were $3.64 per share, up 50% from the prior-year figure of $2.43. The figure surpassed the Zacks Consensus Estimate of $3.54 per share. The uptick can be attributable to solid sales and improved gross margins for the reported quarter. Adjusted earnings also surged 176% from fourth-quarter fiscal 2019.
Net sales of $3,352 million grew 7.3% year over year and beat the Zacks Consensus Estimate of $3,305 million. The increase can be attributable to improved store sales and robust comps. Net sales advanced 28.5% from fourth-quarter fiscal 2019. Strength in key categories, and growth in both average ticket and transactions aided sales.
Consolidated same-store sales (comps) advanced 5.9% compared with comps growth of 19.3% and 5.3% in fourth-quarter fiscal 2020 and fourth-quarter fiscal 2019, respectively. Growth in team sports, apparel and footwear remained upsides.
Store comps also rose 14% year over year, while the metric advanced 24% on a two-year basis. E-commerce sales declined 11% year over year, while it increased 39% on a two-year basis. E-commerce accounted for nearly 27% of net sales for the reported quarter, up from 25% in fourth-quarter fiscal 2019 but down from roughly 32% from fourth-quarter fiscal 2020.
The gross margin expanded 391 basis points (bps) year over year to 37.6% for the quarter under review, driven by robust sales and merchandise margins. Adjusted gross margins expanded 898 bps on a two-year basis. SG&A expenses of 23.4%, as a percentage of sales, contracted 97 bps year over year and 91 bps from fourth-quarter fiscal 2019.
Image Source: Zacks Investment Research
Financial Aspects
DICK'S Sporting ended the reported quarter with cash and cash equivalents of $2,643.2 million, no borrowings under the $1.9-billion revolving credit facility, and total stockholders' equity of $2,101.6 million. Total inventory rose 17.6% year over year as of Jan 29, 2022.
In fiscal 2021, total capital expenditure amounted to $308 million. The company now projects capital expenditure of $400-$425 million on a gross basis for fiscal 2022.
The company hiked its quarterly dividend by 11% to 48.75 cents per share on common stock and Class B common stock, which is likely to be paid out on Mar 25 to shareholders of record as of Mar 18. DICK’S Sporting paid out more than $603 million in the form of dividends in fiscal 2021.
It repurchased 6.78 million shares worth $750.3 million in the fiscal fourth quarter. Following this, the company approved a new share repurchase program, valid for five years, of up to $2 billion. As of Jan 29, 2022, it has $1.855 billion remaining under its existing share repurchase plan. Going ahead, DKS expects to repurchase at least $200 million of its common shares in fiscal 2022.
DICK'S Sporting Goods, Inc. Price, Consensus and EPS Surprise
DICK'S Sporting Goods, Inc. price-consensus-eps-surprise-chart | DICK'S Sporting Goods, Inc. Quote
Guidance
Management issued the fiscal 2022 view. The company envisions adjusted earnings of $11.70-$13.10 fiscal 2022, which compares unfavorably with last year’s reported figure of $15.70. Also, comps are anticipated to be negative 4% to flat, compared with 26.5% and 9.9% comps growth reported in fiscal 2021 and 2020, respectively. The outlook also includes the impacts of elevated freight costs, which are likely to persist in 2022.
Stocks to Consider
Here are three better-ranked stocks to consider — Nordstrom (JWN - Free Report) , Capri Holdings (CPRI - Free Report) and Tractor Supply Company (TSCO - Free Report) .
Nordstrom presently sports a Zacks Rank #1 (Strong Buy). The company has a trailing four-quarter earnings surprise of 13.9%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Nordstrom’s current financial-year sales and EPS suggests growth of 5.7% and 180%, respectively, from the year-ago period’s reported numbers. JWN has an expected EPS growth rate of 6% for three-five years.
Capri Holdings currently flaunts a Zacks Rank #2. The company has a trailing four-quarter earnings surprise of 1,018.2%, on average.
The Zacks Consensus Estimate for Capri Holdings’ current financial-year sales and EPS suggests growth of 37.1% and 215.8%, respectively, from the year-ago period’s reported figures. CPRI has an expected EPS growth rate of 53.9% for three-five years.
Tractor Supply currently carries a Zacks Rank #2. The company has a trailing four-quarter earnings surprise of 22%, on average.
The Zacks Consensus Estimate for Tractor Supply’s current financial-year sales and EPS suggests growth of 8.2% and 8%, respectively, from the year-ago period’s reported figures. TSCO has an expected EPS growth rate of 9.8% for three-five years.