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The income statements reveal that Dick’s had a successful year ending in February 3, 2018, with sales up over 8 percent and net income up 12.5 percent. Unlike many firms, Dick’s does not appear to have received a substantial tax break in the latest calendar year stemming from the new corporate tax laws in the United States. Being 100 percent U.S.-based, the new tax laws should benefit Dick’s significantly as all their revenue is from the United States.

The balance sheets reveal that Dick’s remains in the midst of a stock buyback program that is expected to last until at least 2020. The firm’s stock price declined over 50 percent from late 2016 to late 2017 so purchasing stock at low prices and betting on yourself may be a positive move for Dick’s if the firm is able to regain its equity price footing. Signs are positive based on the company’s revenue and net income increases, but most brick-and-mortar retailers are having difficulty competing with Amazon and other online competitors.

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The income statements reveal that Dick’s had a successful year ending in February 3, 2018, with sales up over 8 percent and net income up 12.5 percent.
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Segment Data

Dick’s revenues by product type. Hardlines comprise 45 percent of revenues. Hardlines include fishing rods, basketballs, cookware, bicycles, and any other products that is not considered apparel or footwear. Despite hardlines accounting for a larger portion of revenue, softlines (footwear and apparel) account for a combined 55 percent of revenue. This comes as little surprise if you recall that Nike and Under Armour account for 32 percent of Dick’s sales and both predominantly supply Dick’s with softgoods.

Locations Map

Exhibit 5 reveals Dick’s store locations by region. Both Dick’s Sporting Goods and Specialty Concept Stores are included in Exhibit 5. Specialty Concept Stores account for 15 percent of stores and include Golf Galaxy and Field & Stream with some free-standing and some combined with Dick’s Sporting Goods stores. Dick’s added a net of 55 stores in fiscal 2016. Dick’s home market of the Northeast trails the Southeast in total number of stores by a wide margin.

Exhibit 5 Dicks Store Locations by Region

Northeast: 191

Southeast: 300

Midwest: 186

West: 120

 

Competitors

In the world of sports retailing, Dick’s Sporting Goods, Academy Sports + Outdoors, Bass Pro Shops, Big 5 Sporting Goods, and Hibbett Sports, are five of the more recognizable names. Dick’s is leader of the group in terms of market capitalization $3.6 billion and sales about $8.6 billion annually, while Academy Sports + Outdoors, Bass Pro Shops, Big 5 Sporting Group, and Hibbett rank second, third, fourth, and fifth respectively in sales. Bass Pro Shops and Academy Sports are privately held firms.

Dick’s is the largest specialty sporting goods company in the U.S. with an impressive market share of 17 percent in 2017. Dick’s market share includes sales from Golf Galaxy and Field & Stream. Academy Sports + Outdoors is similar to Dick’s but includes significantly more fishing and hunting aspects. Bass Pro Shops is also mostly fishing and hunting in nature.

Academy Sports + Outdoors

Headquartered in Katy, Texas, Academy Sports + Outdoors is a privately held company owned by KKR & Company. Founded in 1938, Academy is a sport, outdoor, and lifestyle retailer with a broad assortment of high-quality hunting, fishing, and camping equipment and gear along with sports and leisure products, footwear, apparel, and much more. Academy operates more than 200 stores throughout Alabama, Arkansas, Florida, Georgia, Louisiana, Mississippi, Missouri, Oklahoma, South Carolina, Tennessee, and Texas. Academy revenues have been flat for the last 3 years but are up 60 percent from 2012 to 2017.

Bass Pro Shops (BPS Direct, LLC)

Headquartered in Springfield, Missouri, BPS Direct, LLC is a privately held brick-and-mortar retailer of hunting, fishing, camping, and related outdoor merchandise. BPS Direct owns Cabela’s, White River Marine Group, and Tracker Marine Group. Founded in 1972, Bass Pro Shops recently opened up its new Angler’s Inn in Springfield, Missouri. BPS Direct is similar to Dick’s except BPS offers a full line of boats and boat motors.

Big 5 Sporting Goods (BGFV)

Headquartered in El Segundo, California, and founded in 1955, Big 5 Sporting Goods operates about 425 stores in the western United States only. The company has an e-commerce platform at the www.big5sportinggoods.com website. Big 5’s product mix is almost exactly like Dick’s, including athletic shoes, apparel and accessories, a range of outdoor and athletic equipment for team sports, fitness, camping, hunting, tennis, golf, winter and summer recreation, and roller sports.

Like Dick’s, Big 5 stores carry products from brand name manufacturers, such as Adidas, Coleman, Columbia, Everlast, New Balance, Nike, Rawlings, Skechers, Spalding, Under Armour, and Wilson. Additionally, Big 5 offers private label items including shoes, apparel, camping equipment, fishing supplies, and winter sports equipment. Big 5 sells private label merchandise under its own trademarks (Golden Bear, Harsh, Pacifica, and Rugged Exposure) and offers licensed trademarks brands (Beach Feet, Bearpaw, Body Glove, Morrow, and The Realm).

Hibbett Sports, Inc. (HIBB)

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