Analyst Paul Lejuez of Citi maintained a Hold rating on Dick’s Sporting Goods, retaining the price target of $225.00.
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Paul Lejuez’s rating is based on a combination of factors that reflect both positive performance and certain limitations for Dick’s Sporting Goods. The company demonstrated impressive sales figures with a 5% increase in comparable sales, surpassing expectations. Their earnings per share also exceeded forecasts. However, the translation of these sales successes into earnings growth was not as strong as anticipated, due to ongoing investments that are limiting profit flow-through.
Moreover, while management has slightly raised their guidance for the fiscal year, they have also indicated a potential year-over-year decline in third-quarter earnings per share. This suggests that while sales may continue to perform well, the impact on earnings could be constrained. The recent acquisition of Foot Locker adds another layer of uncertainty, as the integration and necessary investments could affect future earnings. Given these dynamics, Lejuez sees a balanced risk/reward scenario at the current stock levels, leading to a Hold rating.
In another report released today, Wells Fargo also maintained a Hold rating on the stock with a $220.00 price target.