Bear of the Day: Dick's Sporting Goods (DKS)

DICK’s Sporting Goods DKS operates as an omni-channel sporting goods retailer, offering athletic shoes, apparel, accessories, and a broad selection of outdoor and athletic equipment for team sports, fitness, camping, fishing, tennis, golf, water sports, etc.

The company is a current Zacks Rank #5 (Strong Sell), with EPS revisions remaining on a bearish trajectory over recent months.

DKS Lowers Outlook

DICK’S Sporting Goods recently had a tough post-earnings reaction after reporting adjusted EPS of $3.53 and revenue of $5.6 billion, with earnings sliding roughly 20% YoY. Both items fell short of our consensus estimates, with the company missing the Zacks Consensus EPS estimate by an average of roughly -3.5% across its last four releases.

DICK’S business remained relatively solid, with comparable sales rising 4.9%, but Foot Locker proved to be a much bigger drag on the overall story. Comparable sales at Foot Locker fell 3.6%, as softer demand for older footwear styles, fewer major product launches, and a more promotional backdrop all weighed on performance.

That pressure also spilled into its outlook, leading management to cut its fiscal 2026 adjusted EPS outlook to a range of $11 to $12. Shares plunged after the guidance cut, with both annual and quarterly EPS estimates taking a huge hit following the release. 

Shares are now down more than 30% YTD following the post-earnings pressure, erasing several years of gains and trading near levels we haven’t seen since late 2023 and early 2024.

Bottom Line

Negative earnings estimate revisions stemming from a lowered outlook paint a challenging picture for the company’s shares in the near term.

DICK’s Sporting Goods DKS is a Zacks Rank #5 (Strong Sell), indicating that analysts have taken a bearish stance on the company’s earnings outlook.

For those seeking strong stocks, the best idea would be to focus on stocks with a Zacks Rank #1 (Strong Buy) or a Zacks Rank #2 (Buy) – these stocks sport a notably stronger earnings outlook paired with the potential to deliver explosive gains in the near term.

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This article originally published on Zacks Investment Research (zacks.com).

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