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Dick's Sporting Goods Board Authorizes Additional $2B Share Buyback

As of Dec. 16, Dick's Sporting Goods bought back about 7.7 million common shares for $829.1 million during fiscal 2022, which began Feb. 1.
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Dick’s Sporting Goods  (DKS) - Get Dick's Sporting Goods, Inc. Report, the country’s largest sporting goods chain, said in an Securities and Exchange Commission filing that its board has authorized an additional $2 billion of share repurchases.

The authorization lasts for five years. As of Dec. 16, the company bought back about 7.7 million common shares for $829.1 million during fiscal 2022, which began Feb. 1.

That includes about 3.7 million shares for $403 million during the current fiscal quarter.

Some $202.1 million remains under the five-year, $1 billion share repurchase program authorized June 12, 2019.

Dick’s stock recently traded at $104.47, up 5%. It had slumped 22% in the past three months.

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Morningstar analyst David Swartz is bearish on the company, putting fair value at $69.

“We believe no-moat Dick’s Sporting Goods is struggling to stay relevant, as sporting goods are sold through an increasing number of channels,” he wrote Wednesday.

“Although its sales have soared during the pandemic, we believe the impact is temporary, as growth in sporting goods retail has generally been minimal due to external competition.

“According to IBISWorld, sporting goods retail sales experienced average annual growth of just 1.3% in the five years before the pandemic.

“Dick’s competitors include e-commerce operators like wide-moat Amazon  (AMZN) - Get, Inc. Report, mass retailers like wide-moat Walmart  (WMT) - Get Walmart Inc. Report, specialty stores like narrow-moat Lululemon  (LULU) - Get Lululemon Athletica Inc Report and Bass Pro Shops/Cabela’s, and branded stores and owned e-commerce from major vendors.”

Dick’s reported better-than-expected earnings for the quarter ended Oct. 30. Profit totaled $3.19 a share on revenue of $2.75 billion. Analysts surveyed by FactSet had forecast earnings of $2.06 a share on revenue of $2.5 billion.