Shares for Dick’s Sporting Goods Inc. are soaring in premarket trading following earnings that soundly beat expectations as well as the firm’s decision to raise its outlook.
As of 8:30 a.m. ET, the retailer’s stock was up nearly 13% to $44.40. It posted adjusted earnings per share of 52 cents, besting Wall Street’s forecasts of 38 cents, on profits of $44.8 million.
Revenues also topped analysts’ predictions of $1.91 billion, increasing 5.6% to roughly $1.96 billion. Same-store sales shot up 6%, which the company added was its strongest quarterly comps gain since 2013.
“We saw increases in both average ticket and transactions, as well as growth across each of our three primary categories of hardlines, apparel and footwear,” chairman and CEO Edward Stack said in a statement.
For the third quarter ended Nov. 2, online sales rose 13%. Dick’s shared that it had opened six new stores and exited eight Field & Stream stores, which were sold to Sportsman’s Warehouse, as the company continues to undergo a review of its hunting business.
“The momentum in our stores continued to build with our focus on service standards, recognition of great results and stronger marketing,” added president Lauren Hobart. “Combining this with the successful openings of our new e-commerce fulfillment centers and enhanced website functionality, we continue to build one of the best omnichannel experiences in retail.”
In February 2018, as a response to the mass shooting at Marjory Stoneman Douglas High School in Parkland, Fla., Dick’s began the process of destroying assault-style rifles it once sold in its stores and raised the age restriction to 21 for purchases of firearms and ammunition. The company also took down items that resembled assault-style rifles, including nonlethal airsoft guns and toys. It replaced hunting products with other merchandise at stores where the category was underperforming, leading to positive comp sales and better margins at those locations.
Looking ahead, the Coraopolis, Penn.-based company improved its guidance for the full year, projecting adjusted earnings per share to be in the range of $3.50 to $3.60. Its previous forecast called for earnings per share in the range of $3.30 to $3.45. It expects same-store sales to grow 2.5% to 3% over the same period.
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