Summary
DKS is breaking out higher.
Its operations continue to expand.
I am buying stock in this name.
This idea was first discussed with members of my private investing community, Absolute Returns. To get an exclusive 'first look' at my best ideas, start your free trial today >>
Dick's Sporting Goods (DKS) is breaking out higher following stronger fundamental results. Its operations continue to expand, even as its debt level is rising. Its valuation remains reasonable, while investor optimism improves. I am buying stock in this name as its fundamental narrative drives investor sentiment.
Revenue & Growth
DKS had a strong quarter with its merchandise margin rate increasing across the majority of its business categories due to stronger innovation and newness from several of its key partners, as well as higher penetration of its private brands. Its private brand business is a source of strength that continues to accelerate, delivering double-digit growth over the most recent quarter.
After launching its website around this time last year, DKS has seen 24% e-com growth over this past quarter. A large part of the company’s strategy to deliver strong overall growth comes from its key pillars, which management is actively executing on.
