November 30, 2021 8:00 AM
 — 
3
 min

Quarterly Net Profit Soars Nearly 80%

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Dick's Sporting Goods in the third quarter of fiscal year 2021, which ended October 30, increased its net income by 78.6% year-on-year. Revenue rose 14% to $ 2.75 billion from $ 2.41 billion a year earlier, better than the consensus forecast of $ 2.50 billion. Net income for the quarter rose to $ 316.5 million, or $ 2.78 per share compared to from $ 177.2 million, or $ 1.84 per share, received in the comparable period last year. Adjusted earnings climbed to $ 3.19 per share, well above market expectations of $ 1.97 per share.

TIKR
DKS

PRICE
$123

TARGET PRICE
$180

UPSIDE
46%

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10Y UST
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BITCOIN
$56,587(-1.42%)

Dick's like-for-like sales increased 12.2% yoy in the last quarter, well above the 1.9% market consensus. At the same time, online sales grew by only 1% compared to a year earlier, when e-commerce was booming due to restrictions due to the spread of COVID-19. Compared to the pre-pandemic year 2019, this figure has grown by 97%. Online sales accounted for about 21% of total sales in the quarter, up from 19% in 2019, according to a company press release.

Dick's Sporting Goods management improved its outlook for the current fiscal year and now expects to receive adjusted earnings in the range of $ 14.60-14.80 per share on revenue in the range of $ 12.12-12.19 billion. Previously, the company estimated adjusted profit for the fiscal year at $ 12.45-12.95 per share on revenues ranging from $ 11.52 billion to 11.72 billion. In turn, the market expected that the adjusted earnings per share in the 2021 fiscal year would be $ 13.13 on revenue of $ 11,84 bln. We positively assess the quarterly results of Dick's Sporting Goods, as well as the improvement of the annual forecast by the management, therefore we increase the target fair value of the company from $ 179 to $ 180 per share.

Dick's Sporting Goods is a leading U.S. omni-channel sporting goods retailer with more than $12 billion in annualized sales, offering an assortment of sports equipment, apparel, footwear and accessories. The company has 866 U.S. stores, including 734 Dick's Sporting Goods locations, and 132 specialty concept stores under the Golf Galaxy, House of Sport, Public Lands, Field & Stream and Clearance banners. DKS also operates the Dick's Team Sports HQ digital platform in addition to its online e-commerce sites, digital app and Scorecard loyalty program.

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