Bull of the Day: Hibbett Sports (HIBB)

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Based in Birmingham, AL, Hibbett Sports Inc. (HIBB) is a sporting goods store chain that operates in small in and mid-size markets, predominantly in the South, Southwest, Mid-Atlantic, and Midwestern U.S. The company offers shoppers a broad assortment of quality branded athletic footwear, apparel, and equipment with a high level of customer service.

Shares Surge on Strong Q1 Results

The morning Hibbett Sports reported its first quarter earnings, share soared as much as 27% after investors liked what they saw: strong numbers across the board.

Net sales of $343.3 million jumped 25% year-over-year, easily surpassing the Zacks Consensus Estimate; strong top line performance was driven by its recent City Gear acquisition and a solid 5.1% increase in same-store sales (analysts were only projecting 0.7% in comps) Net.

Adjusted earnings of $1.61 also beat our consensus estimate of $1.29 per share without a hitch. Net income came in at $29.8 million.

Additionally, Hibbett opened three new stores, expanded one high-performing location, and closed 24 underperforming stores. The sporting goods retailer now operates a total of 1,144 locations.

“Our first quarter results reflect improved performance in both the store and e-commerce channels,” said President and CEO Jeff Rosenthal in the earnings press release. “We believe our improved web traffic and mobile app, along with continued traction in Buy Online, Pickup in Store, are translating to traffic in our stores and online.”

HIBB is On the Move

Year-to-date, shares of HIBB have increased over 47% compared to the S&P 500’s return of roughly 15.2%.

Earnings estimates have since been rising, and the stock is now a Zacks Rank #1 (Strong Buy).

For the current fiscal year, five analysts have revised their estimate upwards in the past 60 days, and the Zacks Consensus Estimate has jumped 21 cents during that same time period. 2021 looks pretty strong too, with earnings expected to still remain in positive growth positive territory.

Looking ahead, management upped its EPS guidance for fiscal 2020, and now expects to fall between $2.00-$2.15 from $1.80-$2.00 per share; the company will close about 95 more stores in fiscal 2020 as well.

Thanks to bullish guidance, soaring sales and a strong near-term outlook, the future is looking promising for Hibbett Sports. If you’re an investor searching for a retail stock to add to your portfolio, make sure to keep HIBB on your shortlist.

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