DICK'S Sporting Gears Up to Post Q2 Earnings: What to Expect?

DICK’S Sporting Goods Inc. DKS is set to announce its second-quarter fiscal 2024 earnings on Sep. 4.

DKS’ results are expected to register notable sales growth year over year. The Zacks Consensus Estimate for revenues is pegged at $3.4 billion, indicating growth of 6.4% from the year-ago quarter’s figure.

The company’s results are anticipated to reflect solid bottom-line growth. The consensus estimate for earnings is pegged at $3.72 per share, which indicates an increase of 31.9% from the year-ago number. The consensus mark has moved up a penny in the past seven days.

In the last reported quarter, the company delivered an earnings surprise of 12.2%. It has a trailing four-quarter earnings surprise of 4.7%, on average.

Factors to Note About DKS’ Upcoming Release

DICK’S Sporting’s quarterly performance is likely to have benefited from strength in its business and solid execution of its strategic efforts. The company’s robust strategies, including merchandising initiatives and store-related efforts, are likely to have been encouraging. In fact, healthy transaction growth and higher average tickets have been contributing to a solid comparable store sales (comps) performance for a while now. We expect comps to rise 5.7%. 

These factors, along with strong demand for its key product categories, driven by differentiated assortments across footwear, athletic apparel and team sports, are likely to have bolstered its top-line performance.  

However, escalating operating costs amid a high inflationary environment have been concerning. The company has also been witnessing higher selling, general and administrative (SG&A) expenses, due to the higher wage rate and increased investments in talent and technology as well as investments in marketing. These headwinds, coupled with a tough macroeconomic landscape including the volatile consumer behavior, are likely to have acted as deterrents. Our model expects adjusted SG&A expenses to rise 3.5%.

What the Zacks Model Predicts

Our proven conclusively predicts an earnings beat for DICK'S Sporting this time around. 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.

DICK'S Sporting has an Earnings ESP of +0.79% and a Zacks Rank of 2. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.

DICK'S Sporting’s Valuation Picture

DICK'S Sporting has a forward 12-month price-to-earnings ratio of 16.41x, which is below the five-year high of 24.78x but higher than the Retail - Miscellaneous industry’s average of 16.03x.

The recent market movements show that DICK'S Sporting’s shares have gained 31% in the past six months against the industry's 3.9% decline.

Other Stocks With the Favorable Combination

Here are three other companies, which according to our model, have the right combination of elements to post an earnings beat:

Deckers Outdoor Corporation DECK currently has an Earnings ESP of +2.34% and a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.

The company is likely to register top-line growth when it reports second-quarter fiscal 2024 results. The Zacks Consensus Estimate for quarterly revenues is pegged at 1.19 billion, which indicates an increase of 9.2% from the prior-year quarter. 

The consensus estimate for the quarterly earnings per share of $7.24 indicates an increase of 6.2% from the year-ago quarter. The figure has risen a couple of cents in the past seven days. DECK has a trailing four-quarter average earnings surprise of 47.2%.

Tractor Supply TSCO has an Earnings ESP of +0.31% and a Zacks Rank of 2 at present. The company is expected to register top-line growth when it reports third-quarter 2024 results. The consensus estimate for quarterly revenues is pegged at $3.49 billion, which implies a rise of 2.2% from the year-ago quarter.

The Zacks Consensus Estimate for TSCO’s quarterly earnings has been stable in the past 30 days at $2.22 per share. The consensus mark for earnings indicates a 4.7% drop from the year-ago quarter. TSCO delivered a trailing four-quarter average earnings surprise of 3.2%.

Costco Wholesale Corporation COST currently has an Earnings ESP of +0.89% and a Zacks Rank of 3. The company is expected to register bottom and top-line growth when it reports fourth-quarter fiscal 2024 results. The Zacks Consensus Estimate for COST’s quarterly revenues is pegged at $80.2 billion, which implies growth of 1.6% from the year-ago quarter’s figure.

The consensus estimate for Costco’s bottom line has been stable at $5.02 per share over the past 30 days. The consensus mark implies growth of 3.3% from the year-ago quarter’s figure. COST delivered an average earnings surprise of 2.3% in the trailing four quarters.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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Tractor Supply Company (TSCO): Free Stock Analysis Report
 
Deckers Outdoor Corporation (DECK): Free Stock Analysis Report
 
Costco Wholesale Corporation (COST): Free Stock Analysis Report
 
DICK'S Sporting Goods, Inc. (DKS): Free Stock Analysis Report

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