Dick’s Sporting Goods, the Consumer Cyclical sector company, was revisited by a Wall Street analyst yesterday. Analyst Simeon Gutman from Morgan Stanley reiterated a Buy rating on the stock and has a $253.00 price target.
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Simeon Gutman has given his Buy rating due to a combination of factors including the strategic acquisition of FL by Dick’s Sporting Goods, which is expected to enhance earnings through cost synergies and operational improvements. The acquisition is projected to contribute approximately 7% to adjusted EPS by 2027, reflecting a positive outlook on the integration of FL’s operations.
Additionally, Gutman highlights the steady growth potential of Dick’s Sporting Goods’ legacy operations, with expected sustained comparable sales growth and margin expansion driven by improved merchandising and product mix. Despite some uncertainties surrounding FL’s operations, the potential for a successful turnaround, supported by key brand partnerships, adds to the optimistic view of the company’s future performance. Overall, the stock is seen as undervalued given its growth prospects and resilience in the sporting goods retail sector.
Gutman covers the Consumer Cyclical sector, focusing on stocks such as O’Reilly Auto, Dick’s Sporting Goods, and AutoZone. According to TipRanks, Gutman has an average return of 3.7% and a 60.69% success rate on recommended stocks.
In another report released yesterday, D.A. Davidson also maintained a Buy rating on the stock with a $270.00 price target.