Out Fox The $treet

  Under Armour, Inc. has traded down since reporting a solid FQ3'23 earnings report. The athletic apparel company still forecasts producing solid earnings despite a 425 basis point hit to gross margins. Under Armour stock is cheap based on earnings rebounding in FY24 as the promotional environment ends. This idea was discussed in more depth with members of my private investing community, Out Fox The Street.  Learn More »   Some stocks just never seem to get a break, and  Under Armour, Inc.  ( NYSE: UA ,  NYSE: UAA ) falls into this category now. The athletic apparel company handled the inventory issue as best as possible throughout the  covid supply chain issues, yet the stock never got a benefit during the period. My  investment thesis  remains ultra-Bullish on the stock following the dip back below $10. Read the full article on Seeking Alpha.  Disclosure: Long UA. Please review the disclaimer page for more details....

Anyone who follows the sporting goods sector or retail in general probably identifies Dick's Sporting Goods ( NYSE: DKS     ) as a premier operator in the industry. The company has long generated strong margins and profits while expanding its retail base to grab market share from struggling competitors such as Sports Authority . Unfortunately as Dick's store base recently surged beyond 500 locations, the rate of growth has considerably stalled, leaving investors wondering if the growth years are in the rear view mirror. During the recent analyst day, the management team laid out a 5-year plan of growing the revenue base to $10.0 billion from the $5.8 billion generated in 2012 and expanding margins via several initiatives. One of the major goals is to develop a store concept beyond the maturing Dick's brand. Read the full article here . Disclosure: No position mentioned. Please read the declaimer page for more details.

This model lost a disappointing 5.8% in March versus a 3.1% gain for the benchmark S&P 500. This model typical outpaces the major indices by a large margin in up periods so the last month was a major exception. Since the end of 2011, this model has been running on the theme that the majority of stocks would retrace the losses experienced since the July 2011 levels. In essence, our theory all along has been any losses since that time period were from irrational fear of a second financial collapse that the Europeans were unlikely to allow. Naturally this fluctuates on a case by case basis where any individual stock could move a lot higher or lower depending on circumstances since then. Unfortunately this theory took a major turn in March as investors piled into dividend paying stocks sending most major indices higher while at the same time selling the higher risk, global growth stocks. In some cases, it was just a small reversal of the gains from the last couple of ...

This model gained a solid 21.4% in February versus 4.1% for the benchmark S&P 500. This model typical outpaces the major indices by a large margin in up periods and last month was no exception. Since the end of 2011, this model has been running on the theme that the majority of stocks would retrace the losses experienced since the July 2011 levels. In essence, our theory all along has been any losses since that time period were from irrational fear of a second financial collapse that the Europeans were unlikely to allow. Naturally this fluctuates on a case by case basis where any individual stock could move a lot higher or lower depending on circumstances since then. This conviction has allowed us to hold onto a highly leveraged portfolio and see significant gains this year as stocks like Apple (AAPL) , Dicks Sporting Goods (DKS) , Liz Claiborne (LIZ) , and Radware (RDWR) all reached those July levels by February. Other stocks like Manitowoc (MTW), Sears Hold...

After trading down 2% in after hours due to a warning from competitor Big 5 Sports (BGFV) , Dicks Sporting Goods (DKS) is up 11% now based on the announcement of a $200M stock buyback and reiterating of Q4 guidance. It appears that most market participants were expecting at the least a earnings miss. Instead they got a big buyback to support the stock price. This is what happens when investors focus too much on the weak competition. Difficult to extrapolate too much especially when it's just a regional player as well. DKS did lower the upper guidance by $0.01, but that wasn't a shock. Comps are now expected to be flat versus the original expectation of slightly up. The buyback is interesting as I don't see DKS stock as incredibly cheap, but the company is one of the few retailers that has the cash on hand. Per DKS PR: announced today that its Board of Directors has authorized a share repurchase program of up to $200 million of the Company's common stock o...

The headline says it all. Though analysts expect a weak consumer and poll after poll shows a very pessimistic shopper, consumers continue to spend at a record pace.  Not only did consumers come out in droves for the holiday season, but they actually spent more as well. The total ended up 16% higher than last year mostly due to consumers spending roughly 10% more than last year while more shopped than normal.  Naturally economists will point back to the strong 2008 Black Friday period that then saw spending fizzle. This will be the feared example that a weak consumer is only willing to buy deep discounts.  While highly possible, nothing shows that 2011 will see anything close to a repeat of 2008. The economy isn't in a recession now like 2008. Not to mention, the whole world isn't falling apart like back in the period leading up to Christmas 2008. How could consumers even think about picking up spending back then as fear of a financial collapse spread? Cyber...

Dicks Sporting Goods (DKS) has long been a favorite investment pick for Stone Fox Capital. Just search this blog and you'll see plenty of articles. Not to mention the recent post of the store openings in our area. DKS reported strong earnings this morning and surprising established a dividend. DKS announced a $.50 dividend for 2011 payable on December 28th and plans to start a quarterly dividend in 2012. Does this mean that the growth story is over? Hopefully is just means that with $483M in cash that DKS is over flowing with money and thinks dividends are the best way to reward shareholders. Unfortunately in the past it has signaled that companies lack growth opportunities to use that cash. DKS is now in at least 43 states with the entry into Oklahoma at the beginning of November. Little growth opportunities exist in moving into new areas. Maybe it still has growth potential in existing states. The sporting goods industry does remain fragmented and less than 500 stores doesn...

After years of being an investor in Dick's Sporting Goods (DKS) and not actually being able to shop at the retail locations, the company finally opened a sporting goods store in my area. In fact it opened three stores in the Tulsa metro area over the weekend. As a sports enthusiast and investor, DKS probably provides me the ultimate junction of hobby and professional life of any stock worth owning. The grand opening was complete with one of the biggest media blitzes that I've seen or maybe just noticed. Possibly its just that I listen to the sports show on the radio or read the local sports section that I happened to notice the advertising by DKS more than say a women's clothing store or the Chipotle Mexican Grill (CMG) when it arrived. Most people have probably witnessed grand openings of DKS prior so this is already first hand knowledge, but the grand opening ordeal was complete with autograph sessions of OKC Thunder players, past local football greats like Barry Sa...

After the close Thursday, Ulta Beauty ( ULTA )  announced earnings  that easily surpassed estimates. Earnings came in at $.38 versus estimates of $.32 and 72% higher than last year on only a 22.6% increase in revenue. Revenue beat due to very strong comps of 11.3% over 2010. ULTA appears to be firing on all cylinders with gross margins up 170 basis points and inventory per square foot down over 1%. The ability to grow revenue while decreasing inventory suggests superb inventory controls. Read full article at Seeking Alpha.  Disclosure: Long DKS. Please read the disclaimer page for more details. 

After years of being an investor in Dick's Sporting Goods (DKS) and not being able to shop there since they aren't located in Oklahoma, it appears they are finally looking at a location in Broken Arrow just down from my office. They've owned the Golf Galaxy store in Tulsa for a while now, but this will be the first Dick's store within several hundred miles. According to the Tulsa World , BA approved a $900K tax rebate incentive for a store at the Shops at Broken Arrow site. The deal would give Dick's a $90K sales tax rebate for 10 years. Seems like quite the deal for a strong retailer like DKS. From a competition stand point, this location is ideal with BA having a population of close to 100K with zero access to big league sporting goods store. Not to mention any stores in Tulsa like Academy and Sports Authority are very far away. And of course they aren't much competition anyway. The store would also be within a mile of the largest high school in the state....

Another quarter and another solid report from Dick's Sporting Goods (DKS). DKS has to be one of the best run retailers in the world. They continually take market share in a fragmented sporting goods market that has mainly weak competitors. This trend should continue for years. For Q4, DKS reported earnings of $0.76 after forecasting roughly $0.70 on the Q3 report. They achieve this growth mostly by seeing 9% comp sales growth gained mostly from an 8.6% increase at Dick's Sporting Goods stores and a whopping 36% increase in e-commerce. As they continue to gain market share, its possible that the e-commerce site becomes the go to destination with a preference for in store returns to a superior retailer. See the rest of the story at Seeking Alpha . Disclosure: Long DKS. Please review disclaimer page.

Dicks Sporting Goods (DKS) remains one of the best retailers around. As they continue to expand their US footprint they can market share and have become the 80lb gorilla in the sporting goods sector. Heck, I'm a big investor in DKS, but I still can't even shop at their stores other then Golf Galaxy. DKS reported Q3 earnings of $.22 that beat estimates of $.17 and above the $.16 from last year. Same store sales jumped by 5%. Much better then the 1-2% they forecast showing that management continues to UPOD (under promise, over deliver). DKS also guided up for the full year and Q4 stating that they expect strong demand in Q4. The top retailers continue to perform in evident ignorance that the economy is suppose to be weak. Apparently though, good retailers aren't short of shoppers. DKS will remain a core holding of all the Opportunistic Portfolios (Long only, Levered, Hedged - more to come on name changes). Via PR : -- Consolidated non-GAAP earnings per diluted sha...

Dicks Sporting Goods (DKS) reports before the market opens tomorrow on the 9th. In general, analysts expect them to easily surpass earnings as the cold weather drove high sales in the higher margin outerwear category. My main concern is that analysts seem completely fixated on the outerwear business that clearly benefits from snow and cold weather, but what about the golf division. The unusual snow in Texas and cold weather in Florida would have an impact on the golf division. Regardless, we're very bullish on DKS long term. They trade at 19x the $1.32 estimate for this year. Not overly cheap but assuming they beat estimates and as the focus moves toward the 2011 (Jan 2012) estimates I'd expect a much higher stock price. Just don't expect a big ramp on beating estimates tomorrow. Reported earnings of outwear makers like VF Corp ( VFC.N ) and Columbia Sportswear Co ( COLM.O ) as well as suppliers like Under Armor Inc ( UA.N ) and Nike Inc ( NKE.N ) suggest heightened deman...

Sears Holdings ( SHLD ) looks poised to breakout. Once above $70, the next stop is likely $100. Now the market seems do for a pullback according to most analysts and media outlets, but not much of that happened when the market fell off the cliff last fall. Its currently solidly above the 20EMA which is above the 50EMA which is above the 200EMA. Its a beautiful chart once it breaks $70. Its also will have clear higher lows and higher highs at that point. Until something changes don't fight the trend. Also, ignore all the nonsense about SHLD as a company. They have a ton of assets not fairly valued in the current market. SHLD can easily surpass old highs. Dicks Sporting Goods ( DKS ) has a similar chart and setup. Any move above the current close at $20 solidifies a breakout that has some resistance around $24, but mostly opens up the stock to a move back to $30. Both moves net close to the same game so pick your stock. Most people favor DKS for its better run operation, but SHLD lik...

According to this report , DKS has bought 6 prime store locations from a bankrupt retailer in Oregon. This is a prime example all the strong retailers will take advantage of this recession. They'll continue to gain marketshare. I'm not overly bullish about the retail sector as a whole, but the strong companies will spend the next year or so taking share from the companies going belly up. DKS will be one the big benefitors from this trend as sporting goods is very fragmented and in need of consolidation. They'll eventually be the Best Buy of the sector. The downfall of a regional sporting goods chain in Oregon is providing Dick’s Sporting Goods, Inc. the opportunity to accelerate its expansion plans there. With only one store in Oregon so far, Dick’s (NYSE: DKS ) has committed to take over six former locations of Joe’s Sports, Outdoor & More , a 31-store regional chain based in suburban Portland that went out of business in May after filing for bankruptcy, according t...

Stone Fox Capital used the jump in DKS share prices this morning on the back of the JCP bullish news to lighten up on 40% of our shares at $20. The stock is overextended having run roughly 20% above the 20ema. The story is still strong so this is definitely just a trading move. At this point, we'll likely look at the $17 range to re enter a full position. Morgan Stanley (MS) on the other hand had a rather disappointing Q. After the strong results from Goldman Sachs (GS) we had expected MS to report strong numbers. Instead they missed by a huge margin. This was partly due to credit costs, but the CEO also mentioned cautious trading operations that evidently missed the market opportunities gained by GS and the ML unit of BAC. We didn't buy this stock for them to be cautious so we exited the position as the stock looks like it wants to breakdown.