Dick’s Sporting Goods boosts 2022 outlook after second-quarter earnings top estimates

Dick’s Sporting Goods on Tuesday reported quarterly earnings and revenue that topped analysts’ expectations and boosted its financial outlook for the year.

The sporting goods retailer said it now expects comparable store sales for 2022 to decline between 6% to 2%. It had previously forecast the figure to be down between 8% and 2%, after sales of sporting and outdoor equipment surged during the pandemic.

Its shares closed up less than 1%.

For the full year, Dick’s now expects adjusted earnings per share to be between $10 and $12. That’s up from its previous forecast of $9.15 and $11.70.

Dick’s noted that its net sales for the quarter were up significantly from the same period in 2019. Executive Chair Ed Stack said results show the company wasn’t just a beneficiary of higher sales during the pandemic but reflect the structural changes it made years ago.

Here’s what the company reported compared with what Wall Street was expecting, based on a survey of analysts by Refinitiv:

• Earnings per share: $3.68, adjusted, vs. $3.58 expected
• Revenue: $3.11 billion vs. $3.07 billion expected

For the three months ended July 30, net sales fell 5% from a year ago while comparable store sales declined 5.1%. An 8.4% decline in transactions was partially offset by a 3.3% increase in average ticket. Footwear, team sports, and golf were among the best-performing categories, while athletic apparel was challenged by delayed shipments, the company said.

In an interview with CNBC, Stack noted the demand for Dick’s products in the “highs and lows of the economy” and cited the example of someone’s 10-year-old daughter needing bigger sneakers for soccer.

“You don’t walk up to her, put your arm around her go, ‘Hey, honey, you know what? Put on your old cleats, curl up your toe and go play soccer.’ You go buy a new, a new pair of cleats,” he said.

The company said that its inventory level was healthy and well positioned for the back-to-school season.

“We had some trailers that were backed up and our system got clogged up,” Stack told CNBC. “We’ve worked through the vast majority of that and it’ll be all cleaned up by the end of this month, maybe the second week of September.”

— CNBC’s Courtney Reagan contributed to this report.