Top 25 Stocks for the NEXT 25 Years -- Dick's Sporting Goods

The ninth name in my series of the top 25 stocks for the NEXT 25 years is Dick's Sporting Goods Inc. (NYSE: DKS). Dick's is headquartered in Pittsburgh, Pennsylvania, and was actually established in 1948. The original concept was revamped and expanded during the past four years, and the company is on a high-growth trajectory. Dick's will be the most dominating purveyor of sporting goods and apparel in the United States.

Dick's stock closed at $53.40 on Friday and has a market capitalization of $2.8 billion. Dick's currently operates 294 stores, most in the eastern United States. The estimated revenue base for the fiscal year ending January 2008 is $3.8 billion, and for earnings per share I am estimating at $2.40. My January 2009 revenue and earnings per share estimates call for $4.5 billion and $2.95.

Dick's is taking advantage of a very fractured market. The preponderance of sporting goods sales occur in the big box retailers like Wal-Mart Stores (NYSE: WMT) or Target Corp. (NYSE: TGT). It's simply a "small department" for these huge general retailers. The other big competitors have been mom-and-pop stores and a few other larger concepts that have struggled mightily. Dick's is both the growth engine and the consolidator in the sporting goods space. The company has room to grow to 1,100-1,200 stores over the next decade. In 2005, Dick's acquired popular Midwestern retailer Galyan's and with it, the terrific locations.

Sporting goods that Dick's offers range from the usual baseball, football, basketball, and hockey equipment and apparel to the eclectic tastes in golf, fishing, hunting, and more. Dick's is attuned to the electronic world and offers the best line of navigational equipment for boaters and fishermen. What Dick's offers to the sportsman is total selection and information by extremely well-trained salespeople.