Is DICK'S Sporting (DKS) Likely to Beat Earnings in Q1?

DICK’S Sporting Goods Inc. DKS is expected to register year-over-year sales and earnings declines when it releases first-quarter fiscal 2022 results on May 25. The Zacks Consensus Estimate for fiscal first-quarter revenues is pegged at $2.6 billion, indicating a decline of 10.2% from the year-ago quarter’s reported figure.

The consensus estimate for fiscal first-quarter earnings is currently pegged at $2.43, which suggests growth of 35.9% from the year-ago reported number. However, the consensus mark has moved up by a penny in the past seven days.

In the last reported quarter, the company’s earnings beat the Zacks Consensus Estimate by 2.8%. It has a trailing four-quarter earnings surprise of 102.5%, on average.

DICK'S Sporting Goods, Inc. Price and EPS Surprise

 

DICK'S Sporting Goods, Inc. Price and EPS Surprise

DICK'S Sporting Goods, Inc. price-eps-surprise | DICK'S Sporting Goods, Inc. Quote

Key Factors to Note

DICK’S Sporting has been benefiting from favorable customer demand across all categories, improved product assortments and enhanced omni-channel capabilities. Growth in team sports, apparel and footwear has been an upside. The persistence of the above-mentioned trends is likely to have aided the top line and same-store sales in the fiscal first quarter. Progress on its transformational plan is also expected to have aided its performance in the to-be-reported quarter.

Moreover, the company has been witnessing a robust gross margin trend, owing to improved merchandise margins and strong sales. Improved merchandise margins and lower fixed expenses are likely to have aided the gross margin and the bottom line in the fiscal first quarter.

The company has been gaining from the strong online show, courtesy of its robust online demand and improved omni-channel capabilities, which are expected to have favored the fiscal first-quarter performance. It has been on track to build the best omni-channel experience for athletes by strengthening the store network and expanding the e-commerce presence. The online unit is expected to have benefited from services like in-store and curbside pickup, reduced promotions, faster delivery, and a better checkout experience. Its mobile platform has also been a key growth driver.

However, on the last reported quarter’s earnings call, management expected the impacts of elevated freight costs to continue in the first quarter of fiscal 2022. It also anticipated supply-chain issues, inflation and surging oil prices to hurt its performance in the same period.

What the Zacks Model Unveils

Our proven model conclusively predicts an earnings beat for DICK’S Sporting this reporting cycle. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

DICK’S Sporting currently has a Zacks Rank #3 and has an Earnings ESP of +0.74%.

Other Stocks With Favorable Combination

Here are some other companies worth considering from the same sector as our model shows that these too have the right combination of elements to beat on earnings:

The Kroger Co. KR currently has an Earnings ESP of +2.95% and a Zacks Rank of 2. The company is expected to have registered top and bottom-line growth in first-quarter fiscal 2022. The Zacks Consensus Estimate for KR’s quarterly revenues is pegged at $43.2 billion, which suggests a rise of 4.7% from the figure reported in the prior-year quarter.

You can see the complete list of today's Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Kroger’s quarterly earnings moved up 6.7% in the last 30 days to $1.27 per share, suggesting 6.7% growth from the year-ago quarter's reported number. KR has delivered an earnings beat of 22.1%, on average, in the trailing four quarters.

Designer Brands DBI has an Earnings ESP of +4.35% and a Zacks Rank #2 at present. The company is expected to have registered top and bottom-line growth in first-quarter fiscal 2022. The Zacks Consensus Estimate for DBI’s quarterly revenues is pegged at $806.7 million, which suggests a rise of 14.7% from the figure reported in the prior-year quarter.

The Zacks Consensus Estimate for Designer Brands’ quarterly earnings moved up by a penny in the last 30 days to 23 cents per share, suggesting 91.7% growth from the year-ago quarter's reported number. DBI has delivered an earnings beat of 112.8%, on average, in the trailing four quarters.

Casey's General Stores CASY currently has an Earnings ESP of +7.07% and a Zacks Rank #3. The company is anticipated to have registered top and bottom-line growth in fourth-quarter fiscal 2022. The Zacks Consensus Estimate for CASY’s quarterly earnings moved up by a penny in the last seven days to $1.49 per share, suggesting 33% growth from the year-ago quarter's reported number.

The Zacks Consensus Estimate for Casey's quarterly revenues is pegged at $3.4 billion, suggesting growth of 44.7% from the figure reported in the prior-year quarter. CASY has delivered an earnings beat of 21.6%, on average, in the trailing four quarters.

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