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Tuesday, November 14, 2017

=Dick's Sporting Goods (DKS) reported earnings on Tue 14 Nov 17 (b/o)

Dick's Sporting Goods beats by $0.04, beats on revs; guides Q4 EPS above consensus; warns about FY18 EPS 
  • Reports Q3 (Oct) adj. earnings of $0.30 per share, $0.04 better than the Capital IQ Consensus of $0.26; revenues rose 7.4% year/year to $1.94 bln vs the $1.9 bln Capital IQ Consensus. 
  • Consolidated same store sales decreased 0.9%, compared to the Company's guidance of a low single-digit decrease. Third quarter 2016 consolidated same store sales increased 5.2%.
  • eCommerce sales for the third quarter of 2017 increased ~16%. eCommerce penetration for the third quarter of 2017 was 10.3% of total net sales, compared to 9.6% during the third quarter of 2016. In the third quarter, the Company opened 15 new DICK'S Sporting Goods stores and six new Field & Stream stores. The Company also closed two specialty concept stores.
  • "In the third quarter, we delivered earnings per diluted share and comp sales at the high end of our expectations, with continued double-digit growth in eCommerce. As expected, margins were under pressure in this highly promotional environment, but our strategy for this environment enabled us to continue to capture market share."
  • Co issues upside guidance for Q4, sees EPS of $1.12-1.24 vs. $1.11 Capital IQ Consensus Estimate. Consolidated same store sales are currently expected to decline in the low single-digits in the fourth quarter of 2017, compared to an increase of 5.0% in the fourth quarter of 2016.
  • "As we look to the fourth quarter, we are comfortable with our prior implied sales and earnings outlook, and believe we are well positioned to gain additional market share." Mr. Stack continued, "Looking ahead, we see tremendous opportunity in our industry as it continues to evolve. We plan to make significant investments in our business, which will have a short-term negative impact on our earnings; however, we expect these investments will pay meaningful dividends in the future. We plan to increase investments in our eCommerce business, the technology in our stores and store payroll in order to enhance the customer experience. Meaningful investments will also be made to DICK'S Team Sports HQ, and in the development and support of our private brands. Given these investments, continued gross margin pressure and ~flat comp sales, we expect earnings per diluted share to decline by as much as 20 percent in 2018." Down 20% would imply EPS of $2.38 vs. $2.83 consensus. 

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