Retail

Earnings Previews: Dick's Sporting Goods, Express

Monday morning’s earnings announcement from JD.com beat consensus estimates on both the top and bottom lines, but the general dissatisfaction with the Chinese government’s recent moves to rein in public companies is a high hurdle to leap over.

We have already previewed five firms reporting after markets close Monday or before they open Tuesday morning: Best Buy, Medtronic, New Oriental Education, Palo Alto Networks and Pinduoduo. Later this week we are expecting quarterly results from Dell, Peloton, Salesforce, Snowflake, Xpeng  and more.

Earlier this morning, we looked at three companies reporting results after markets close Tuesday: Heico, Intuit and Nordstrom. Here, we look at three companies set to report results before markets open Wednesday.

Dick’s Sporting Goods

Sporting gear retailer Dick’s Sporting Goods Inc. (NYSE: DKS) has posted a share price gain of almost 145% over the past 12 months, including an increase of nearly 100% in 2021 to date. Since losing about 65% of their January value by late March of last year, shares are up nearly 590%. Outdoor recreational activities like camping and indoor fitness activities boomed during the pandemic and the boom hasn’t stopped yet.

However, analysts remain mixed on the stock, probably wondering when the surge will end. Of 26 brokerages covering the shares, 13 have given the stock Buy or Strong Buy ratings and another 11 rate the shares at Hold. At a recent price of around $111.20, the stock’s upside potential based on a median price target of $115 is about 3.4%. At the high target of $150, the implied upside is about 35%.

For the second quarter of fiscal 2022, analysts are forecasting revenue of $2.84 billion and adjusted EPS of $2.82. Those numbers reflect a sequential decline of about 2.8% in revenue and 25.7% in EPS. Year over year, second-quarter sales are expected to rise by 4.8% and EPS are expected to fall by 9.6%. For the full fiscal year, EPS are forecast to rise by 48.5% to $9.09 and revenue is expected to rise 14.2% to $10.94 billion.

The stock trades at 12.9 times expected 2022 EPS, 15.9 times estimated 2023 earnings and 15.0 times estimated 2024 earnings. The stock’s 52-week range is $45.57 to $112.40, and the high was posted earlier Monday. The company pays an annual dividend of $1.45 (yield of 1.32%).

Express

Apparel retailer Express Inc. (NYSE: EXPR) stock has absolutely soared in the past 12 months, adding about 550% to its share price. At the height of meme stock mania in late January, the stock was up 800% for the year to date. For all of 2020, the stock lost more than 81%, and from its trough in early November, the stock is up more than 1,000%. Over the past three months, Express has virtually disappeared from the meme stock universe.

The stock is barely covered by brokerage houses. Just three have ratings on the stock and all three are Hold. At a share price of around $6.80, the stock has outrun its average (and high) price target of $5.00.

For the second quarter of fiscal 2022, Express is expected to report revenue of $447.92 million, which would be up nearly 30% sequentially and a whopping 82% year over year. Analysts expect an adjusted net loss of $0.30 per share for the quarter, compared to a loss of $0.55 in the prior quarter and $1.48 in the second quarter of 2020. For the full fiscal year, the loss per share is forecast at $0.70, down from a loss per share of $4.86 in 2020. Sales for the year are forecast to rise by almost 58% to $1.91 billion.

The stock’s multiple to estimated 2023 EPS is 102.3. No other estimates are available. The stock’s 52-week range is $0.57 to $13.97, and Express does not pay a dividend.