DICK’S SPORTING GOODS Reports Second Quarter FY2024 Earnings Results on July 31, 2023
August 31, 2023
🌥️Earnings Overview
On July 31 2023, DICK’S SPORTING GOODS ($NYSE:DKS) announced its earnings results for the second quarter of FY2024, showing total revenue of USD 3223.6 million – a 3.6% increase year-over-year – but net income decreased by 23.3%, amounting to USD 244.3 million.
Market Price
The stock opened at $116.8 and closed at $111.5, a significant 24.2% drop from its previous closing price of $147.0. This marked the biggest one-day decline for the company in over a decade. The unfavorable earnings results can be mainly attributed to the slow sales growth in the retail business and increased supply chain costs due to the ongoing pandemic. Additionally, the company’s investments in digital initiatives failed to generate returns in the second quarter, further exacerbating the situation. Despite these short-term setbacks, DICK’S SPORTING GOODS is still optimistic about its long-term prospects. The company expects to benefit from its recent investments in digital and e-commerce solutions in the coming quarters, as well as its continuing focus on driving customer loyalty and engagement.
In addition, the company has maintained its commitment to offering quality products at competitive prices, which should help boost consumer confidence in the brand. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for DKS. More…
| Total Revenues | Net Income | Net Margin |
| 12.62k | 1.01k | 8.0% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for DKS. More…
| Operations | Investing | Financing |
| 1.51k | -490.66 | -1.02k |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for DKS. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 9.36k | 6.71k | 30.67 |
Key Ratios Snapshot
Some of the financial key ratios for DKS are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 13.6% | 53.9% | 10.7% |
| FCF Margin | ROE | ROA |
| 8.5% | 31.8% | 9.0% |
Analysis
At GoodWhale, we performed an analysis of DICK’S SPORTING GOODS’ wellbeing. Our Star Chart showed that DICK’S SPORTING GOODS scored a high health score of 8/10, indicating it is capable of safely riding out any potential crisis without risking bankruptcy. DICK’S SPORTING GOODS is strong in asset, dividend, growth, and profitability metrics. Based on our analysis, we classified DICK’S SPORTING GOODS as a ‘rhino’ company; one that has achieved moderate revenue or earnings growth. Investors interested in investing in companies like DICK’S SPORTING GOODS generally seek moderate returns, with a long-term orientation. They tend to prefer companies that have achieved moderate shifts in valuation, making them attractive long-term investments. We believe that DICK’S SPORTING GOODS is an ideal fit for these investors who are seeking stability and moderate returns. More…
Peers
Dick’s Sporting Goods Inc is a leading retailer of sporting goods and apparel in the United States. It operates through two segments: Dick’s Sporting Goods and Golf Galaxy. The company offers a wide range of products, including equipment, footwear, and apparel. It also provides services, such as golf instruction and fitting, hunting and fishing trips, and repairs and replacements. Dick’s Sporting Goods competes with Shimamura Co Ltd, Hibbett Inc, Folli Follie Commercial Manufacturing And Technical SA, and other retailers in the sporting goods and apparel industry.
– Shimamura Co Ltd ($TSE:8227)
Shimamura Co Ltd is a large company with a market cap of 449.84B as of 2022. The company has a return on equity of 7.86%. Shimamura Co Ltd is a Japanese company that operates a chain of general merchandise stores. The company offers a wide range of products, including clothing, household goods, and food.
– Hibbett Inc ($NASDAQ:HIBB)
Hibbett Inc. is a publicly traded company with a market cap of 722.03M as of 2022. The company operates in the retail sector and focuses on selling sporting goods and apparel. Hibbett Inc. has a return on equity of 27.86% as of 2022. The company’s stock is traded on the NASDAQ under the ticker symbol HIBB.
– Folli Follie Commercial Manufacturing And Technical SA ($OTCPK:FLLIY)
Folli Follie Commercial Manufacturing And Technical SA is a Greece-based company engaged in the design, manufacture and sale of jewelry, watches and fashion accessories. The Company’s product portfolio includes rings, earrings, bracelets, necklaces, pendants, cufflinks, key rings and money clips, among others. It also offers a range of watches for men and women. The Company operates a network of over 190 stores in Greece, Cyprus, the United Kingdom, Italy, Hong Kong, China and the United States.
Summary
DICK’S SPORTING GOODS reported a 3.6% year-on-year increase in revenue to USD 3223.6 million for the second quarter of FY2024, but this was offset by the 23.3% decrease in net income to USD 244.3 million. This caused their stock price to go down on the day of the announcement. Investors should continue to monitor the company’s financial performance in the coming quarters to determine if the current financial trend is temporary or indicative of an underlying problem. It is also important to look at the company’s competitive position and product mix, along with other external factors like consumer spending, to evaluate the company’s long-term prospects.
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