Dick's Sporting Goods, Inc. (NYSE:DKS)

CAPS Rating: 3 out of 5

An authentic full-line sporting goods retailer offering a assortment of brand name sporting goods equipment, apparel, and footwear in a specialty store environment.

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Player Avatar TMF1000 (99.70) Submitted: 12/17/2012 5:57:00 PM : Outperform Start Price: $44.87 DKS Score: -39.04

I placed DKS on caps at $45.54 - The PE ratio was 18.59 on an adjusted basis. They are paying an annual dividend of $0.50 giving them a dividend yield of 1.1%. They have some stiff competition from HIBB, CAB, and BGFV, but for now there is room for all. The Company believes they can place 900 stores in the U.S, they presently have 592. They have a long track record of successful growth and on an adjusted basis is cheaper than their main peers, though that is a debatable point.

They have only a small part of the sporting goods market. One of the majors will lose ground as these companies spread across the U.S. I think DKS will grab market share for a long time and becomes a category killer. However, this will take years before I can conclude this definitively.

March 6, 2012 4Q:2011 earnings’ highlights:
** 4Q revenue was $1.612 billion up from $1.519 billion
** Fiscal 2011 revenue was $5.212 billion up from $4.87 billion
** TTM revenue was $5.212 billion or $41.26 per share
** 4Q earnings were $0.88 up from $0.71
** TTM earnings were $2.10 up from $1.50
** Diluted share count 126.316 million
** Cash $734.402 million: debt $159 million
** Cash flow for the year was $208.6 million or $1.65
** Capital expenditures for the year was $201.807 million up from $159.067 million
** Annual dividend $0.50
** 561 stores: Same store sales up 0.1%
** Trading range between March 6, 2012 and May 15, 2012 was $46.70 to $51.58: PE ratio range was 22.24 to 24.56: PS ratio range was 1.13 to 1.25: Cash flow yield range was 3.2% to 3.5%: Dividend yield range was 1% to 1.1%

May 15, 2012 1Q:2012 earnings’ highlights:
** Revenue was $1.282 billion up from $1.114 billion
** TTM revenue was $5.38 billion or $42.36 per share
** Earnings were $0.45 up from $0.30
** TTM earnings were $2.25 per share
** Diluted share count 127.003 million
** Cash flow for the quarter was Negative ($59.021 million) down from ($47 million)
** TTM cash flow was $196.6 million or $1.55 per share
** Trading range between May 15, 2012 and August 14, 2012 was $44.06 to $52: PE ratio range was 19.58 to 23.11: PS ratio range was 1.04 to 1.23: Cash flow yield range was 3% to 3.5%

August 14, 2012 2Q:2012 earnings’ highlights:
** Revenue was $1.437 billion up from $1.307 billion
** TTM revenue was $5.51 billion or $44.25 per share
** Earnings were $0.43* down from $0.59**
** Adjusted earnings should be $0.65 up from $0.52
** Adjusted TTM earnings were $2.38 per share
** Diluted share count 124.533 million
** Same store sales were up 3.8%: 571 stores
** Cash flow for six months was negative ($28.2 million) down from $40.378 million
** TTM cash flow was $140.022 million or $1.12
** Trading range between August 14, 2012 and November 13, 2012 was $47.91 to $54.24: adjusted PE ratio range was 20.13 to 22.79: PS ratio range was 1.08 to 1.23: Cash flow yield range was 2.1% to 2.3%

*Earnings of $0.43 included a $0.22 charge related to the acquisition of JJB Sports.
** Earnings of $0.59 per share included a $0.07 gain from a sale of an investment.

November 13, 2012 3Q:2012 earnings’ highlights:
** Revenue was $1.312 billion up from $1.18 billion
** TTM revenue was $5.64 billion or $44.80 per share
** Earnings were $0.40 up from $0.33
** TTM earnings were $2.45 per share
** Diluted share count 125.938 million
** Cash flow for nine months was negative ($74.112 million) up from negative ($112 million)
** TTM cash flow was $246.49 million or $1.96 per share
** Same store sales up 5.1%: Stores 592
** Trading range between November 13, 2012 and the present December 17, 2012 was $44.81 to $53.02: Adj.PE ratio range 18.29

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