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Academy Sports and Outdoors (ASO)
NASDAQ:ASO
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Academy Sports and Outdoors
(NASDAQ:ASO)
69Neutral
Positive Factors
Sales Momentum
ASO experienced an acceleration in comparable sales momentum through the Holiday season, with positive comps in December.
Stock Potential
The stock is seen to have over 25% upside potential due to compelling comparative sales drivers and margin initiatives.
Valuation
ASO is trading at a valuation that is a 15% discount to the trailing 12-month FY1 average, suggesting attractive investment potential.
Negative Factors
Earnings Momentum
Analysts anticipate further deceleration in earnings momentum, with comparable sales ranging between -2% and +1%, and increased investments in selling, general, and administrative expenses driving a contraction in adjusted operating income margin.
Future Sales Visibility
Limited visibility into future comparable sales and rising investments in selling, general, and administrative expenses to support new store growth and eCommerce keep analysts on the sidelines.
Margin Pressure
The gross margin decline of approximately 100 basis points year-over-year pressured adjusted operating income to $161 million, which was 7% below consensus expectations.
Academy Sports and Outdoors (ASO) vs. S&P 500 (SPY)
Market Cap
$2.63B
Dividend Yield1.22%
Average Volume (3M)2.01M
Price to Earnings (P/E)6.8
Beta (1Y)1.30
Revenue Growth-3.67%
EPS Growth-14.66%
CountryUS
Employees9,900
SectorConsumer Cyclical
Sector Strength61
IndustrySpecialty Retail
Share Statistics
EPS (TTM)5.76
Shares Outstanding67,004,730
10 Day Avg. Volume2,134,990
30 Day Avg. Volume2,007,427
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.54
Price to Cash Flow (P/CF)8.50
P/FCF Ratio20.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$59.92Price Target Upside59.36% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering13
Academy Sports and Outdoors Business Overview & Revenue Model
Company DescriptionAcademy Sports and Outdoors, Inc., through its subsidiaries, operates as a sporting goods and outdoor recreational products retailer in the United States. The company sells coolers and drinkware, camping accessories, camping equipment, sunglasses, backpacks, and sports bags; marine equipment and fishing rods, reels, baits, and equipment; firearms, ammunition, archery and archery equipment, camouflage apparel, waders, shooting accessories, optics, airguns, and hunting equipment; team sports equipment, including baseball, football, basketball, soccer, golf, racket sports, and volleyball; fitness equipment and accessories, and nutrition supplies; and patio furniture, outdoor cooking, wheeled goods, trampolines, playsets, watersports, and pet equipment, as well as electronics products, watches, consumables, batteries, etc. It also offers outdoor apparel, seasonal apparel, denim, work apparel, graphic t-shirts, and accessories; boys and girls outdoor and athletic apparel; sporting apparel and apparel for fitness; professional and collegiate team licensed apparel and accessories; casual shoes and slippers, work and western boots, youth footwear, socks, and hunting and seasonal footwear; and boys and girls athletic footwear, running shoes, athletic lifestyle and training shoes, team and specialty sports footwear, and slides. The company sells its products under the Academy Sports + Outdoors, Magellan Outdoors, BCG, O'rageous, Outdoor Gourmet, and Freely brand names. As of June 14, 2022, it operated 260 retail locations in 16 contiguous states. The company also sells merchandise to customers through the academy.com website. Academy Sports and Outdoors, Inc. was founded in 1938 and is headquartered in Katy, Texas.
How the Company Makes MoneyAcademy Sports and Outdoors generates revenue primarily through the sale of its diverse product lines across its network of physical retail locations and its e-commerce platform. The company offers an extensive selection of branded and private-label merchandise, covering categories such as hunting, fishing, camping, fitness, team sports, and leisure activities. Key revenue streams include the sale of sports equipment, outdoor gear, and athletic apparel. Additionally, Academy Sports and Outdoors benefits from strategic partnerships with major brands, exclusive product offerings, and seasonal promotions that drive customer traffic and sales. The company's revenue is also supported by its customer loyalty programs and marketing initiatives aimed at enhancing customer engagement and retention.
Academy Sports and Outdoors Financial Statement Overview
Summary
Academy Sports and Outdoors demonstrates a balanced financial performance with strengths in cash flow management and profitability. While revenue growth has been a challenge, operational efficiency and financial stability have been maintained. The company should focus on improving revenue and managing leverage to enhance its financial position further.Income Statement
Academy Sports and Outdoors has experienced declining revenues over the past few years. The gross profit margin and net profit margin have remained relatively stable, indicating effective cost management. However, the decline in EBIT and EBITDA margins suggests some operational inefficiencies. Despite this, the company maintains a satisfactory level of profitability in a challenging retail environment.72
Positive
Balance Sheet
The company has managed to improve its equity position over the years, with a positive trajectory in stockholders' equity. However, the debt-to-equity ratio remains high, indicating potential leverage risk. The equity ratio shows a solid level of asset financing through equity, highlighting financial stability improvements.65
Positive
Cash Flow
Academy Sports and Outdoors has shown strong operating cash flow relative to net income, indicating good cash generation efficiency. The free cash flow remains positive, although the growth rate has slowed, reflecting prudent capital management. The company manages its cash flows effectively, ensuring liquidity and operational continuity.78
Positive
| Breakdown | ||||
| Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 | Mar 2021 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 5.93B | 6.16B | 6.40B | 6.77B | 5.69B | Gross Profit |
| 2.01B | 2.11B | 2.21B | 2.35B | 1.73B | EBIT |
| 538.64M | 677.86M | 846.55M | 907.95M | 420.40M | EBITDA |
| 693.17M | 820.14M | 971.51M | 1.00B | 534.95M | Net Income Common Stockholders |
| 418.45M | 519.19M | 628.00M | 671.38M | 308.76M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 288.93M | 347.92M | 337.14M | 486.00M | 377.60M | Total Assets |
| 4.90B | 4.68B | 4.60B | 4.58B | 4.38B | Total Debt |
| 1.30B | 1.70B | 1.77B | 1.85B | 2.02B | Net Debt |
| 1.01B | 1.35B | 1.43B | 1.36B | 1.64B | Total Liabilities |
| 2.90B | 2.72B | 2.97B | 3.12B | 3.27B | Stockholders Equity |
| 2.00B | 1.95B | 1.63B | 1.47B | 1.11B |
| Cash Flow | Free Cash Flow | |||
| 328.49M | 327.49M | 443.20M | 597.25M | 970.33M | Operating Cash Flow |
| 528.08M | 535.78M | 552.00M | 673.26M | 1.01B | Investing Cash Flow |
| -186.12M | -206.14M | -108.81M | -76.02M | -33.14M | Financing Cash Flow |
| -400.95M | -318.87M | -592.05M | -488.85M | -750.23M |
Academy Sports and Outdoors Technical Analysis
Negative
37.60
Price Trends
49.44
Negative
51.07
Negative
52.52
Negative
Market Momentum
-0.84
Negative
43.94
Neutral
23.56
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ASO, the sentiment is Negative. The current price of 37.6 is below the 20-day moving average (MA) of 46.24, below the 50-day MA of 49.44, and below the 200-day MA of 52.52, indicating a bearish trend. The MACD of -0.84 indicates Negative momentum. The RSI at 43.94 is Neutral, neither overbought nor oversold. The STOCH value of 23.56 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ASO.
Academy Sports and Outdoors Risk Analysis
Academy Sports and Outdoors disclosed 40 risk factors in its most recent earnings report. Academy Sports and Outdoors reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Academy Sports and Outdoors Peers Comparison
Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $14.60B | 13.01 | 40.08% | 2.47% | 3.53% | 13.86% | |
75 Outperform | $29.65B | 27.33 | 49.83% | 1.70% | 2.25% | 1.00% | |
73 Outperform | $699.55B | 36.28 | 22.23% | 1.03% | 5.07% | 25.86% | |
71 Outperform | $406.63B | 53.50 | 32.89% | 0.51% | 6.13% | 12.14% | |
69 Neutral | $2.63B | 6.84 | 21.14% | 1.22% | -3.67% | -14.66% | |
61 Neutral | $13.15B | 14.54 | 31.63% | 6.06% | -4.43% | -24.58% | |
59 Neutral | $11.22B | 10.13 | -1.22% | 3.96% | 1.32% | -18.57% |
* Consumer Cyclical Sector Average
Performance Comparison
ASO
Academy Sports and Outdoors
37.60
-24.51
-39.46%
BBY
Best Buy Co
60.44
-16.33
-21.27%
COST
Costco
916.48
208.54
29.46%
DKS
Dick's Sporting Goods
182.87
-20.38
-10.03%
TSCO
Tractor Supply
52.40
3.28
6.68%
WMT
Walmart
83.19
24.08
40.74%
Academy Sports and Outdoors Earnings Call Summary
Earnings Call Date: Mar 20, 2025 | % Change Since: -20.74% | Next Earnings Date: Jun 10, 2025
Earnings Call Sentiment Neutral
The earnings call reflects a mixed sentiment with strong performance in certain segments and strategic initiatives like new store openings and the introduction of My Academy Rewards. However, challenges such as net sales decline, decreased comp sales, and gross margin pressure indicate a cautious outlook. Overall, the highlights and lowlights suggest a balanced perspective.Highlights
Strong Performance in Outdoor Category
Outdoor was the best performing category with a 2% net sales growth in Q4, driven by Hunting, Fishing, and Camping business and key national brands like YETI and Stanley.
Apparel Sales Rebound
Apparel sales improved with only a 1% decline in Q4, driven by Youth Apparel, Fleece, and Workwear. Key brands like Nike and Carhartt performed strongly during the holiday season.
Positive Trends in New Store Openings
The 2022 vintage stores outperformed the existing store base by running a positive comp. New stores are expected to drive future growth, with 20 to 25 new stores planned for 2025.
Successful Launch of My Academy Rewards
Over 11 million customers enrolled in My Academy Rewards, resulting in strong uplift in spend from loyalty members during the holidays.
Significant Growth in Private Brands
Private brands represented 23% of total net sales in 2024, up from 22% in 2023, driven by customer gravitation towards value.
Record Shareholder Returns
Returned over $396 million to shareholders through dividends and share repurchases in 2024, with an 18% increase in dividends approved for 2025.
Lowlights
Net Sales Decline
Net sales for Q4 2024 were $1.68 billion, representing a 6.6% decline year-over-year due to the loss of the 53rd week from the previous year.
Decrease in Comp Sales
Excluding new stores, comp sales decreased by 3% in Q4 2024, slightly exceeding guidance but reflecting consumer spending constraints.
Gross Margin Decline
Gross margin rate declined by 110 basis points to 32.2% in Q4, driven by higher freight and distribution costs and lower merchandise margins.
Increased Inventory Levels
Inventory balance increased by 9.6% to $1.3 billion, with per-store inventory units down 2.9% but inventory dollars up 3.7%.
Company Guidance
During the Academy Sports and Outdoors Fourth Quarter Fiscal 2024 Results Conference Call, the company provided guidance for Fiscal 2025, projecting net sales between $6.1 billion and $6.3 billion. They expect comparable sales to range from negative 2% to positive 1%. Gross margin is anticipated to be between 34.0% and 34.5%, despite potential tariff impacts. The company plans to open 20 to 25 new stores and continue expanding their e-commerce and private brand offerings. Adjusted net income is forecasted to range from $400 million to $435 million, with adjusted diluted earnings per share between $5.75 and $6.20. They also expect to generate $290 million to $320 million in adjusted free cash flow, with $220 million to $250 million allocated for capital expenditures.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.