Dick’s Sporting Goods Inc. raised its full-year outlook, a welcome sign of strong consumer demand as the retailer prepares to acquire sneaker chain Foot Locker Inc.
The retailer now sees comparable sales in a range of 2 percent to 3.5 percent for the full year and earnings per share at $13.90 to $14.50, above its previous projections. The forecast includes expected impact from all tariffs currently in effect, the company said.
Chief executive officer Lauren Hobart has been investing in Dick’s store network, adding more experiential shops while improving e-commerce functions. The latest results show these efforts are paying off with shoppers. Comparable store sales rose 5 percent for the quarter ended August 2, surpassing the average analyst estimate.
Dick’s is set to close the $2.4 billion Foot Locker deal in September. The agreement will unite two retailers with vastly different business models, with Dick’s adding about 2,400 mostly mall-based stores to its network of around 800 big-box sporting goods locations.
Hobart has yet to present a strategic vision for Foot Locker, but Dick’s has said it expects to operate the company as a separate business unit.
Dick’s chairman Ed Stack addressed investor concerns about the acquisition in May, assuring them that Foot Locker will reach shoppers that Dick’s doesn’t yet have access to, and that executives will improve operations at the struggling retailer.
Dick’s shares rose 0.6 percent at 7:17 a.m. in New York Thursday in pre-market trading. The stock has fallen 1.2 percent this year through Wednesday’s close, below the 10 percent gain of the S&P 500 Index.
By Kim Bhasin
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