Hibbett (NASDAQ:HIBB) shares are trending nearly 11% higher today after the athletic apparel and product provider posted mixed second-quarter numbers, with revenue declining 4.6% year-over-year to $374.9 million. The figure fell short of expectations by $1.2 million.
However, the company’s EPS of $0.85 came in ahead of expectations by $0.12. Consumers are pulling back on discretionary spending in the current inflationary environment. As a result, Hibbett’s comparable sales dropped by 7.3%, with declines in Brick-and-mortar and eCommerce coming in at 7.7% and 5.2%, respectively.
Furthermore, a combination of higher promotional activity and a lower average product margin resulted in the company’s gross margin softening by 160 basis points to 32.8% in Q2.
Despite these challenges, Hibbett has maintained its full-year 2024 expectations. The company expects total revenue growth to range between 0% and 2% for the year, while EPS is anticipated to be in the range of $7 to $7.75.
Overall, the Street has a consensus price target of $51.57 for Hibbett, alongside a Moderate Buy consensus rating. This points to a substantial 40% potential upside in the stock.
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