Dick's Sporting Goods and Burlington Stores surged early Tuesday after reporting better-than-expected third-quarter earnings. Other retail stocks also rallied on earnings while Kohl's and Lowe's dropped after same-stores decreased more than predicted.
In one of the earnings season's busiest weeks for retail earnings, BURL shares jumped 11% while DKS advanced more than 8% Tuesday during premarket action. Broadly, other retail stocks also gained ground Tuesday while Kohl's stock and LOW fell around 4%.
Burlington reported third-quarter EPS growing 128% to 98 cents with revenue increasing 11% to $2.28 billion. Analysts had expected earnings of 97 cents per share and revenue of $2.29 billion. Meanwhile, the retailer also reported same-store sales increased 6%, more than expected.
Burlington Chief Executive Michael O'Sullivan said in the earnings release that "November is off to a solid start, helped by cooler weather at the beginning of the month."
"We feel very good about how we are set up for holiday," he added. "That said, the critical high-volume weeks are still ahead of us, and we recognize that there is a lot of uncertainty in the external environment."
Fellow retail stock Dick's Sporting Goods topped earnings and revenue predictions and hiked its full-year profit view Tuesday. The company saw EPS of $2.85, up 10% vs. 2022, and revenue totaling $3.04 billion, a 3% increase compared to last year. DKS' comparable sales increased 1.7% vs. expectations of a 1.3% decline.
Dick's Sporting Goods also revised upward its full-year guidance. The company forecasts 2023 EPS of $12-$12.60, up from previous guidance of $11.50-$12.30, and same-store sales increasing between 0.5%-2%, up from 0%-2% previously.
Chief Executive Lauren Hobart said in the earnings release that DKS is "excited for the upcoming holiday season."
Dick's Sporting Goods: Retail Stocks
It is a busy Tuesday for retail stocks just ahead of Thanksgiving and Black Friday sales at most stores.
Financial reports Tuesday came from Abercrombie & Fitch, American Eagle Outfitters, Urban Outfitters and Nordstrom along with Kohl's, Burlington, Dick's Sporting Goods and Lowe's.
Abercrombie & Fitch stock reached its highest level in more than a decade Friday, after retail stocks Gap and Ross Stores posted better-than-expected earnings and revenue on Thursday. Retail giants Target and Walmart both also topped Q3 predictions.
Overall holiday season sales are expected to increase between 3% and 4% this year, from $957 billion to $966 billion, according to the National Retail Federation estimates. Online and other non-store sales are projected to see a 7% to 9% gain, to between $273.7 billion and $278.8 billion.
Meanwhile, the Consumer Price Index (CPI) was flat in October vs. September, signaling inflation may be cooling, although the gauge was still up 3.2% from a year ago, according to last week's report. Both were below expectations, sparking a market rally.
Please follow Kit Norton on X, formerly known as Twitter, @KitNorton for more coverage.
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