Sunday, February 26, 2012

Dick’s Advances on Repurchase Plan Despite Lower Guidance

Dick’s Sporting Goods (DKS) rose 11% in midday trading today after announcing a new $200 million share repurchase plan. The company also lowered the upper end of its fourth quarter and full-year guidance range by a penny, and lowered it same store sale guidance. “The Company also expects fourth quarter 2011 consolidated same store sales to be slightly negative to slightly positive compared to the original outlook of flat to an increase of 1%.”

“At the time of our third quarter earnings announcement we noted that our guidance was predicated on normal winter weather patterns,” said Chairman and CEO Edward W. Stack. “While the warmer- and drier-than-normal winter has impacted our same store sales and inventory levels, sales and gross margin pressure has been minimized due to better than anticipated operating leverage, resulting in anticipated full year EPS growth of 23 to 24%.”

Dick’s is bucking the trend among retailers, most of which are trading flat today after the government announced that retail sales had grown just 0.1% in December.

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