As the market moved toward Friday's launch of the Black Friday holiday shopping season, retail stocks were in motion. Earnings reports rolled out Tuesday from Dick's Sporting Goods, Burlington Stores, Abercrombie & Fitch, Best Buy and Kohl's. Dick's led the group, moving sharply higher in early trade, then narrowing its gain as the group reversed lower.
Dick's Sporting Goods Tops Views
Coraopolis, Pa.-based Dick's reported sound beats on both its revenue and earnings lines. Earnings dipped just over 2% to $2.78 a share, vs. views for $2.69. Revenue edged up to $3.06 billion. Consensus estimates called for a slight slip to $3.03 billion.
Management ratcheted up its full-year earnings guidance to between $13.65 and $13.95 per share, up from $13.55-$13.90. Consensus going into the report was $13.88. Revenue guidance moved up to between $13.2 billion and $13.3 billion. Prior guidance topped out at $13.2 billion, and the consensus v view was $13.25 billion.Same store sales rose 4.2% in the third quarter. The company set its full year 2024 guidance for comparable sales growth to between 3.6% and 4.2%, up from 2.5% to 3.5%.
President and Chief Executive Lauren Hobart noted in a statement that the company, "had an excellent back-to-school season and continued to gain market share."
DKS Stock Poised For Breakout
DKS shares popped 6.5% in early action on Tuesday,. It then reversed to a narrow decline. Dick's was already sitting on a spirited three-day run up.
Within that run, the 205 price point would've provided aggressive investors an early entry, as the stock broke back above its two month downtrend on Friday. Slightly upwind of that is 219.43, about where progress stalled on Monday.
The traditional buy point identified by MarketSurge chart analysis is 239.30. The stock's progress has stalled right around the traditional buy point levels in its past two (May and August) breakouts.
TJX, IBD Stock Of The Day, Actionable After Earnings
Black Friday Preview: Burlington, Abercrombie, Best Buy and Kohl's
Among the other retailers reporting, Burlington Stores met consensus views for earnings and came up short on the revenue line. The company said warmer weather starting in mid-September stalled its Q3 momentum going into the Black Friday season start. Burlington shares dropped 2% in morning trade Tuesday.
Abercrombie & Fitch beat on its top and bottom lines, and raised its fourth-quarter and full-year guidance. Both the Q3 growth and Q4 guidance numbers were well below the company's recent, triple digit pace of gains. The company also named a new chief financial officer, Robert Ball, who has 21 years of experience with the company.
Abercrombie shares reversed a brief early decline, trading nearly 5% lower on Tuesday. A trendline break at around 162 could act as an early entry.
Best Buy reported lower than expected earnings and revenue. Kohl's earnings missed the analysts' targets by a wide margin, while revenue just met expectations. Best Buy shares fell 6.9%. Kohl's swooned 21%.
