Dick's Sporting Goods Inc. (DKS) on Tuesday announced better-than-expected financial results for the third quarter. The strong results were mainly driven by increased home fitness trends and improved outdoor sports activities due to the pandemic that resulted in higher demand for the company’s products.
The Coraopolis, Pennsylvania-based sporting goods retail company reported earnings of $177.2 million, or $1.84 per share for the three months ended October 31, representing a nearly 3-fold increase from $57.6 million, or 66 cents per share in the comparable period last year. On an adjusted basis, profit rose to $2.01, easily beating analysts’ average estimate of $1.08 per share.
Revenue for the quarter came in at $2.41 billion, translating to a surge of 23.2 percent versus last year, and better than $2.24 billion forecasted by analysts.
Same-store sales jumped 23.2 percent on a year-over-year basis, while analysts surveyed by FactSet had forecasted a surge of 13 percent.
Speaking on the results, the company’s president Lauren Hobart said “overall, the favorable trends in our business have continued into Q4. These strong sales results have been partially offset by warmer weather that has negatively impacted sales in important cold-weather categories. Taken together, through the first three weeks of Q4, our consolidated comp sales have increased in the high-teens."
E-commerce revenue skyrocketed 95 percent on a year-over-year basis, and represented 21 percent of the overall sales, as compared to 13 percent in the year-ago quarter. Moreover, total inventory in the quarter reduced by 9.8 percent versus the same period last year.
Dick's Sporting Goods (NYSE: DKS) shares fell more than 3 percent on Tuesday morning despite strong third-quarter performance. DKS stock is currently trading on a heavy volume of 4 million shares, as compared to the daily average volume of 2.59 million shares.
Disclaimer: I have no positions in any of the stocks mentioned. I wrote this article myself, and it expresses my own opinions. I have no business relationship with any company whose stock is mentioned in this article. All information should be independently verified and should not be relied upon for purposes of transacting securities or other investments. See terms for more info.