Big 5 Sporting Goods Corp.
) announced favorable sales results for the fourth quarter and
full-year 2013. The company also revised its earnings outlook for
the same period.
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Net sales for the quarter rose 1.8% to $248.0 million from $243.6
million last year. However, comparable store sales (comps)
slipped 0.5% compared to the prior-year quarter and also came
below the previous guidance of lower single-digit growth. Last
year, the company posted a 6.5% increase in comps for the fourth
In the apparel segment comps rose in the lower double-digit range
but showed a marginal improvement in the footwear segment. Also,
sales in the hardgoods segment declined in the mid-single digits
due to soft demand for firearm and ammunition products, which was
the main driver of comps in the last quarter. Comps also
decreased owing to unfavorable weather condition in the Western
However, the company's merchandise margins for the quarter
expanded by 47 basis points (bps). Big 5's continued focus on
improvising product margins and effective cost management have
been quite impressive, enabling the company to deliver healthy
Big 5 reported net sales of $993.3 million for fiscal 2013, which
rose 5.6% from $940.5 million year over year. Further, comps for
the year increased 3.9%.
Given the sales results, the athletic goods retailer revised its
earnings outlook. The company now envisions earnings in the band
of 21-23 cents per share in its fourth quarter, which is narrower
than the previous guidance of 20-28 cents per share. The Zacks
Consensus Estimate for the quarter currently stands at 25 cents a
share, slightly above the company's current prediction.
For fiscal 2013, Big 5 anticipates earnings to range from
$1.24-$1.26 a share, below the Zacks Consensus Estimate of $1.32
Though the holiday season has been a tough one for many retailers
because of the competitive promotional environment, Big 5 faced
the challenges well and is favorably positioned to deliver
another sturdy quarter, backed by healthy product margins and
cost containment efforts. Currently, this California-based
company holds a Zacks Rank #2 (Buy).
Although some retailers made their way out through the tough
season, others struggled to lure budget-constrained consumers and
trimmed their forecast due to lower-than-expected sales and
margin pressure. Retailers that lowered their guidance battered
by the holiday results include
Family Dollar Stores Inc.
American Eagle Outfitters Inc.
L Brands Inc.