Shares for Hibbett Sports Inc. are surging more than 20% in Friday morning trading on the heels of a stellar third-quarter financial report.
The Birmingham, Ala.-based firm noted adjusted earnings per share of 32 cents, far exceeding Wall Street’s bets of 15 cents. Adjusted profits for the period ended Nov. 2 totaled $5.8 million, compared with the previous year’s $2.6 million.
Revenues also exceeded analysts’ forecasts of $260.8 million, jumping 27% to $275.5 million, including $43.7 million for City Gear. (Hibbett acquired the Memphis, Tenn.-based retailer last October for $88 million in cash.)
“City Gear has now been part of Hibbett for one year, and the acquisition will continue to enhance results through synergies as we complete the integration over the next three months,” President and CEO Jeff Rosenthal said.
Further, same-store sales rose 10.7%, its strongest quarterly increase since the first quarter of 2013 and fourth consecutive quarter with positive comps.
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“The business continues to perform very well as evidenced by the positive comparable performance in both our brick-and-mortar locations and our e‑commerce business,” Rosenthal said. “This sales growth has been made possible by our team’s execution of our strategic focus to lead with sneakers and connect toe-to-head concepts within our apparel and team sports businesses.”
During the quarter, Hibbett opened four stores, expanded one high-performing location and rebranded another four as City Gear outposts. It also closed 19 underperforming stores, bringing its fleet to 1,097 in 35 states. The firm added that its digital performance continues to exceed expectations, now delivering 10.5% of its total revenues.
For the full year, Hibbett now predicts adjusted earnings per diluted share to be in the range of $2.30 to $2.50, compared with its previous outlook of $2.15 to $2.25. It also raised its guidance for a same-store sales gain of 4% to 6%, versus the prior 1% to 2%.
“We are very enthusiastic about our business going forward,” Rosenthal added.
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