MODG

Dick’s Sporting Goods Soars, Raises Dividend 10%

by

Image: Dick’s Sporting Goods’ shares have soared since the doldrums of the COVID-19 meltdown. By Brian Nelson, CFA On March 14, Dividend Growth Newsletter portfolio holding Dick’s Sporting Goods (DKS) reported better-than-expected top and bottom-line performance for the fourth quarter and issued a solid outlook for fiscal 2024. Shares of Dick’s Sporting Goods have done fantastic since the worst of the COVID-19 meltdown years ago, and the momentum behind its business remains strong, as evidenced by a nice 10% increase in its quarterly dividend. We expect to raise our fair value estimate of Dick’s Sporting Goods upon our next valuation model update, and the company remains a key idea in the Dividend Growth Newsletter portfolio. Management’s commentary in the quarterly … Read more

Dick’s Sporting Goods Still Looks Really Cheap

by

Image Source: Dick’s Sporting Goods By Brian Nelson, CFA On November 21, Dick’s Sporting Goods (DKS) reported solid third-quarter results with sales up 2.8% on a year-over-year basis thanks to comparable store sales growth of 1.7% that lapped an impressive 6.5% increase in the same period a year ago. Non-GAAP earnings per share came in at $2.85 in the quarter, up from $2.60 in last year’s period. The company also raised its 2023 comparable store sales growth guidance range to 0.5%-2% from flat to 2% previously, and it raised its 2023 non-GAAP earnings per share outlook to $12.00-$12.60 from its previous range of $11.50-$12.30. We liked the news and continue to believe that shares of Dick’s Sporting Goods are mispriced. … Read more

Dick’s Sporting Goods Down ~7% Year-to-Date; Sticking with It Long Term

by

Image Source: Mike Mozart By Brian Nelson, CFA Dividend growth investing continues to face pressure during 2023 as investors have migrated to entities with strong net cash positions, solid free cash flow generation and secular growth prospects, many ideas of which can be found in the areas of big cap tech (XLK) and large cap growth (SCHG). The SPDR S&P Dividend ETF (SDY), which includes high-yielding Dividend Aristocrats, is down more than 4% so far in 2023 on a price-only basis and is off more than 6% over the past year, also on a price-only basis. With interest rates on the rise, the tradeoff between owning a certificate of deposit at the local bank yielding north of 5% and dividend … Read more

Dick’s Sporting Goods Trades at Less Than 10x Expected Fiscal 2023 Earnings; We Like Shares

by

Image Source: Dick’s Sporting Goods By Brian Nelson, CFA When it comes to retail exposure, Dick’s Sporting Goods (DKS) is one of our top considerations. The company reported strong first-quarter fiscal 2023 results for the period ending April 29, 2023, that showed 3.4% same-store-sales growth and a 19% advance in non-GAAP earnings per diluted share. For fiscal 2023, management is targeting positive same-store sales expansion and earnings per diluted share in the range of $12.90-$13.80, implying that shares are trading at less than 10x expected fiscal 2023 earnings. The company has considerable long-term operating lease liabilities, but it has a net cash position. Dick’s Sporting Goods raised its dividend considerably recently, and we continue to like shares in the Dividend … Read more