Outdoor sporting goods retailer Athletes’ warehouse (NASDAQ: SPWH) The stock plunged on news of its termination of its acquisition by Great Outdoors for $ 18 per share. The trend of reopening retail businesses has run its course, with most people taking a second COVID-19 vaccination booster. Fishing, hunting and camping have experienced an unprecedented boom during the pandemic, as none of these sports involve a lot of contact and cannot be practiced alone. This is why the acquisition by Great Outdoors made sense. Even at $ 18, the price-to-earnings ratio would be less than 11. Investors must be wondering what convinced Great Outdoors to cancel the acquisition. On the other hand, this can present opportunistic price points for cautious investors seeking exposure in the outdoor sports segment.
Publication of results for the third quarter of fiscal 2021
On August 3, 2021, Winnebago released its second quarter 2021 tax results for the quarter ending October 2021. The company reported earnings per share (EPS) of $ 0.51, below analysts’ expectations of 0. $ 54, from ($ -0.03). Revenue rose 4% year-on-year to $ 401.1 million, beating analyst consensus estimates of $ 389.47 million. Comparable store sales (SSS) were down (-1.5%) year on year. Online sales grew 15% year-over-year.
Take-out conference call
Sportsman’s Warehouse CEO John Barker set the tone: “During the third quarter, our e-commerce-driven sales growth continued at a rapid pace, allowing us to serve our customers securely and to extend our digital reach. Both in-store and online, demand was high across all of our categories. During the quarter, we worked closely with our suppliers and provided our customers with inventory levels that we believed were unmatched by our direct competitors. However, we are not satisfied. We are convinced that inventory constraints and not declining demand were the master of our growth during the quarter. We ended the third quarter with a better inventory position compared to the second quarter in all departments except shooting sports. He continued, “In addition to hunting, participation in fishing, camping and hiking continued at a high rate throughout the third quarter, as confirmed by national park attendance and sales of hunting and fishing license. During this period, we have extended our loyalty program to nearly 2.6 million customers and increased our overall email database by 84% year-on-year. We believe we are capitalizing on our best credit and loyalty card programs, as well as our expanded database to better engage with customers, which helps us drive traffic in stores and online.
He concluded: “Finally, I would like to share some ideas on the trends and results for the first quarter. Overall, total net sales for the fiscal month of November increased by approximately 70% from the previous year. This is a continuation of the sales growth trend we saw in the third quarter. While firearms and ammunition continue to be in high demand, we are performing strong across all major product categories. This widespread growth confirms our belief that increased participation in activities such as camping and fishing is a sustainable trend. Looking at last weekend, unlike many retailers, we saw an increase in foot traffic in our stores during Black Friday weekend. Additionally, online traffic saw significant increases over the previous year with triple-digit online demand. These results give us optimism that our categories continue to grow and that our product line and the Sportsman’s Warehouse brand are resonating with customers. Moving on to slide 8. In summary, while there is significant uncertainty regarding the trajectory of the pandemic and its impact on the economy, we are strongly encouraged by the influx of new participants into the businesses in which we specialize. . The sustainable factors impacting our society in 2020 have motivated millions of people to engage or re-engage with the outdoors. We believe Sportsman’s Warehouse is well positioned to meet this increased demand, and we are just beginning to engage with new customers in several product categories. We also believe that we are strategically positioned to continue to capitalize on significant growth opportunities stemming from increased participation in the outdoors, growth in e-commerce and new store expansion, which we believe will result in increased involvement in the outdoors. create long-term shareholder value. We look forward to talking to you again at the end of March when we release our fourth quarter and full year 2020 results. ”
SPWH opportunistic price levels
Using the rifle charts over the weekly and daily periods provides a broader view of the landscape for the SPWH stock. The weekly rifle chart is based on the $ 17.83 Fibonacci level (fib) before collapsing on the ad. The downtrend on the weekly gun chart has a 5-period moving average (MA) down to $ 14.39, followed by the 15-period MA at $ 16.53. The Weekly Stochastic has a mini reverse puppy close to the 20 band with weekly Bollinger Bands (BB) at $ 11.91. The downtrend on the Daily Rifles chart is stagnating with a fixed 5-period MA at $ 11.51 and a 15-period MA at $ 13.81. The daily weak market structure (MSL) buy triggers on a breakout up to $ 11.78. The Daily Stochastic is compressed below Band 10 but attempts to coil. Cautious investors can watch for opportunistic pullbacks at the $ 11.04, $ 10.18, $ 9.55, $ 8.82, $ 8.15 and $ 7.56 level. The upward trajectories are from the $ 13.83 level to the $ 16.91 level.
Should you invest $ 1,000 in Sportsman’s Warehouse now?
Before you consider Sportsman’s Warehouse, you’ll want to hear this.
MarketBeat tracks Wall Street’s top-rated and top-performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat identified the five stocks that top analysts quietly whisper to their clients to buy now before the broader market takes hold of… and Sportsman’s Warehouse was not on the list.
While Sportsman’s Warehouse currently has a “Buy” rating among analysts, top-rated analysts believe these five stocks are better bets.
See the 5 actions here
Companies mentioned in this article
Compare these actions Add these actions to my watchlist