Dick's Sporting Goods beats the estimates game

Granted, the stock is safely away from the 52-week low of $9.21, but the 52-week high is over $30, so I'd say that Dick's has a way to go before it fully recaptures its past glory. Of course, just about every company can say that. And let's keep in mind two very important data points. First, non-GAAP earnings one year ago were 62 cents per share, so the current results represent a significant drop. Second, same-store sales decreased over 8%. Actually, let me get a third data point in: operational cash flow decreased for the year.

I just don't think it's time to buy Dick's yet. And if you are by any chance interested in picking up some of the company's shares for your portfolio, I hope you'd at least wait for a pullback.

I don't think I'd want to buy immediately after a 17% rally. I think the stock did well on Tuesday not only because of the earnings beat, but also because of the major rallies in the major indexes. The Dow itself went up well over 5%.

Well, let me tell you something, I don't buy the rally. I hope I'm wrong, but I'm still bearish on the markets. I therefore don't think that a two-penny beat by a sports retailer is that impressive. And I think Dick's could easily fall back below $10. The market had a case of earnings fever yesterday when it came to Dick's. Don't succumb to it!

Other retailers might make better investment candidates, such as discounters Wal-Mart (NYSE: WMT) and Family Dollar Stores (NYSE: FDO). Consumers don't have to bulk up on golf clubs, keep in mind. Of course, even those two stocks must be approached with caution, since in this market, anything can happen.

Disclosure: I don't own any company mentioned; positions can change without notice.