I have waxed poetically about how much I like golf in the past -- some may even say that I am obsessed (like Tiger Woods' lawyers -- kidding). With the great city of Cincinnati finally wrapping up winter and seeing that bright glowing orb known as the sun, I can't help but think about getting out there on the links and destroying some landscaping.

One sure way to tell that golf season is right around the corner is when your local Dick's Sporting Goods (NYSE: DKS) starts touting itself as the golf headquarters. Well, guess what happened over the weekend? That's right, I saw my first golf commercial. My question is, will the start of golf season be enough to help the sports retailer put the recent downturn behind itself and push forward?

There can be no doubt that the recent downturn in the economy has beaten down and battered the retail sector, and DKS is no exception. On a weekly basis, the stock has descended steadily since 2007 -- wilting under pressure from its 10-, 20-, and 50-week moving averages.

Continue reading JockStocks: Is Dick's Sporting Goods about to tee off and drive higher?

JockStocks: Is Dick's Sporting Goods about to tee off and drive higher? originally appeared on BloggingStocks on Fri, 03 Apr 2009 12:50:00 EST. Please see our terms for use of feeds.

Dick's Sporting Goods (NYSE: DKS) competed on Tuesday in a contest that no company really wants to play: the Expectations Game. Things turned out pretty well for the famous seller of sports stuff (being that I'm no athlete, I can't say I've purchased anything from the place). For the fourth quarter, Dick's posted adjusted income of 55 cents per diluted share. Analysts surveyed by Reuters believed that the chain might do 53 cents per share.

Very cool. In fact, Dick's stock closed yesterday at $12.84. The shares gained over 17% on excellent volume. So, one might expect that the earnings were great and that the stock is a buy. Not so fast.

Continue reading Dick's Sporting Goods beats the estimates game

Dick's Sporting Goods beats the estimates game originally appeared on BloggingStocks on Wed, 11 Mar 2009 09:00:00 EST. Please see our terms for use of feeds.

Continue reading Dicks Sporting Goods (DKS) soars on lifted guidance

Dicks Sporting Goods (DKS) soars on lifted guidance originally appeared on BloggingStocks on Fri, 06 Feb 2009 14:00:00 EST. Please see our terms for use of feeds.

• O'Reilly Automotive (NASDAQ: ORLY) is an auto parts retailer that is facing weak demand as a result of soaring crude oil prices. However, analysts believe the company's strategy to buy CSK Auto will bring a lot of national success. ORLY is expected to show earnings of $1.76 per share this year and $2.02 next year.
• Stanley Works (NYSE: SWK), headquartered in New Britain, Conn., has the advantage of being one of only two companies offering a complete line of hand tools for consumers. The company focuses its performance on both its industrial tool division and a security business. Analysts forecast a profit of $4.18 this year, and $4.63 a share for next year.

Continue reading Kiplinger suggests five stocks for Father's Day

Kiplinger suggests five stocks for Father's Day originally appeared on BloggingStocks on Wed, 11 Jun 2008 16:44:00 EST. Please see our terms for use of feeds.

Financial Select Sector SPDR (AMEX: XLF) is recently down $1.05 to $29.46. XLF call option volume of 16,078 contracts compares to put volume of 59,665 contracts. XLF December option implied volatility of 40 is above its 26-week average is 25 according to Track Data, suggesting hedging for continued downside risk.

Dicks Sporting Goods Inc. (NYSE: DKS), an operator of 314 sporting goods stores, is expected to report EPS of five cents on November 20 according to Thompson First Call. Nollenberger Capital Partners says, "we would use this pullback as a unique opportunity to buy the stock at a compelling valuation." DKS December option implied volatility of 64 is above its 26-week average of 34 according to Track Data, suggesting larger price action.

Option update: Financial Select Sector put volume suggests downside risk originally appeared on BloggingStocks on Mon, 19 Nov 2007 13:47:00 EST. Please see our terms for use of feeds.

Following today's close Dick's Sporting Goods (DKS) announced an acquisition of Golf Galaxy (GGXY). DKS is going to pay about $225 million for the company ($18.82/share) which is a premium of 20% over Monday's closing price. The transaction will be financed using an existing credit facility according to Marketwatch.

Golf Galaxy (most recent 10Q) operates 61 golf stores in 24 states, primarily located in the northern and Midwestern United States, and an e-commerce/catalog business. Golf Galaxy recently completed an acquisition of The GolfWorks - a company focused on selling golf club components, clubmaking tools, and technical information on golf clubs. The company came public on August 3, 2005 with an offering price of $14 per share.

According to Capital IQ Golf Galaxy did $250 million in revenues, $13 million in EBIT, and $7.7 million in net income over the last twelve months (LTM). Therefore DKS paid about .9x sales, 17x EBIT, and 29x net income. These figures are above peer valuations. For example, Golfsmith International (GOLF) trades for .5x sales and 13x EV/EBIT, however the firm's net income is negative. Big Five Sporting Goods (BGFV) fetches .7x sales, 11.4x EV/EBIT and 18.6x earnings.

While it seems DKS didn't purchase GGXY at a discount to the peers, the valuation makes more sense when looking at the valuations of retailers experiencing similar rates of growth. The average analyst estimate of long term growth for GGXY is 26% and analysts believe the company will grow revenues to roughly $365 million in 2008. The average estimate of long term growth for Hibbett Sporting Goods (HIBB) is only 19%. However, HIBB currently fetches 2x sales, 14.5x EV/EBIT and 29x earnings.

Golf is an extremely lucrative segment of sporting goods due to the sport's rapidly growing popularity and typically affluent user-base. Dick's Sporting Good's acquisition of Golf Galaxy will likely help the company gain traction in this competitive sub-sector of the sporting goods market in a relatively cost-effective manner.

Dicks Sporting Goods goes golfing originally appeared on BloggingStocks on Mon, 13 Nov 2006 17:50:00 EST. Please see our terms for use of feeds.