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Sports and outdoor academy (ASO) crushed earnings estimates for its fiscal second quarter ahead of Thursday’s opened and increased guidance for the full year. ASO stock fell below a buy point but rebounded to rally.
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The sporting goods retailer also announced a $ 500 million share buyback program over the next three years.
Sports awards from the Academy
Estimates: Wall Street expects Academy Sports earnings of $ 1.46 per share, according to FactSet. There is no EPS number from a year ago. Year over year, revenue increased 3% to $ 1.658 billion.
Comparable store sales are expected to increase 6.2% from 38.9% in the first quarter.
Results: Academy Sports profits rose 83% to $ 1.99 per share as revenue rose 11% to $ 1.792 billion, thanks to strong consumer demand across its product categories. Comparable sales increased 11.4%, marking the eighth consecutive quarter of positive comparable sales. E-commerce sales fell 0.9%, following a 21% decline in the first quarter as the two quarters faced difficult mixes.
Outlook: For the full year 2021, ASO now forecasts revenue of $ 6.465 billion to $ 6.620 billion. Analysts were expecting $ 6.153 billion, according to FactSet. He sees EPS of $ 5.45 to $ 5.80. Analysts had targeted $ 4.69. The company is seeing comparable sales increase by 14-17%. Analysts had expected 10.1%.
“It is important to note that we continue to improve our profitability at a faster rate than our sales growth. As a result, we are increasing our guidance for fiscal 2021,” said CFO Michael Mullican in a communicated.
“Going forward, we plan to use our capabilities to accelerate our omnichannel, new store and other growth initiatives,” he added.
ASO Stock
Shares of Academy Sports & Outdoors rose 2.3% to 44.38 in the stock market today, rebounding after initially falling to 39.05, just above the 50-day line. ASO stock is now back above a 42.85 buy point from a cut base it cleared in late August, according to MarketSmith chart analysis. Most of the base formed below the 10 week line which is negative.
Among other sporting goods retailers, Dicks Sporting Goods (DKS) grew by 2.4% and The 5 great sportsmen (BGFV) rose 5.5%. Hibbett Sports (HIBB) climbed 1%.
Last October, Academy Sports & Outdoors went public in an initial public offering of $ 1.1 billion. The IPO was priced at $ 13 per share, below the range, although demand for sporting goods increased during the coronavirus pandemic. Americans stuck in homes were looking for outdoor and recreational activities at home.
Meanwhile, ASO’s e-commerce sales have exploded, with people shopping online from their homes. And its stores have remained widely open under lockdown, labeling themselves as essential retailers.
In the first quarter, ASO profits jumped to $ 1.89 per share from 1 cent a year ago, boosted by buyers using stimulus checks. This helps ASO stock achieve an unbeatable EPS rating of 99 and a near-perfect composite rating of 98 from the Investor’s Business Daily.
Private equity firm KKR bought Academy Sports in 2011. ASO sells sports shoes, clothing and supplies, as well as hunting, fishing, cycling and camping equipment.
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