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Hibbett Offers a Sneak Peek Into Its Solid Q2 Sales Picture
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Hibbett Sports, Inc. (HIBB - Free Report) updated investors on its sales results for the second quarter of 2021 ending Aug 1. The company highlighted that its top line remains encouraging, driven by pent-up consumer demand, additional payments from government programs, consumers’ increasing preference for online shopping and temporary store closures of its rivals stemming from the coronavirus pandemic. In fact, some of its competitors have shut stores permanently after being badly hit by the impacts of the virus. These instances led to a rise in store and online traffic along with gaining new customers.
Further, it is gaining from store reopening efforts in a phased manner. In this regard, Hibbett Sports and City Gear stores started opening toward the end of April, keeping in mind local health guidelines. Currently, majority of its stores have reopened and are witnessing solid momentum. Also, increased focus on e-commerce operations by offering home delivery, buy online and pick-up in store, reserve online and pick-up in store, buy online ship to store, same-day delivery and mobile app services, to fulfill online orders and serve customers better bodes well.
Upbeat View
Hibbett’s enhanced omnichannel capabilities, improved supply-chain management, ability to provide in-demand products to customers and store reopening efforts are enabling it to combat the tough retail environment. Also, it expects the recently acquired City Gear business to contribute significantly to sales. During second-quarter fiscal 2021, the company envisions total comparable store sales (comps) to grow more than 70% year over year, with brick and mortar comps and online comps expected to rise nearly 60% and 200% year over year, respectively. Meanwhile, total comps for the first half of fiscal 2021 are projected to increase almost 20% year over year, with brick and mortar comps and online comps estimated to be up roughly 7% and 140%, respectively.
Notably, first-time customers are likely to contribute 25% of brick and mortar sales and roughly 40% of online sales. Overall, the Zacks Rank #2 (Buy) stock has surged 71.1% in the past three months, outperforming the industry’s growth of 28.7%.
Hurdles Persists
Despite interacting with vendors to manage inventory, the company anticipates inventory levels to be down significantly year over year. Apart from these, it had borrowed $50 million in the fiscal first quarter from its credit facility, which has now been repaid. Additionally, Hibbett is likely to incur costs related to increased business, leading to sturdy sales along with the implementation of safety protocols for employees and customers as well as employee benefits and compensation.
Alongside these, continued impacts from COVID-19 and the uncertainty looming over the back-to-school season have led management to refrain from providing fiscal 2021 guidance.
Office Depot (ODP - Free Report) has an expected long-term earnings growth rate of 6.8% and a Zacks Rank #2.
Tractor Supply Company (TSCO - Free Report) has an expected long-term earnings growth rate of 12.3% and a Zacks Rank #2.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2021.
Image: Bigstock
Hibbett Offers a Sneak Peek Into Its Solid Q2 Sales Picture
Hibbett Sports, Inc. (HIBB - Free Report) updated investors on its sales results for the second quarter of 2021 ending Aug 1. The company highlighted that its top line remains encouraging, driven by pent-up consumer demand, additional payments from government programs, consumers’ increasing preference for online shopping and temporary store closures of its rivals stemming from the coronavirus pandemic. In fact, some of its competitors have shut stores permanently after being badly hit by the impacts of the virus. These instances led to a rise in store and online traffic along with gaining new customers.
Further, it is gaining from store reopening efforts in a phased manner. In this regard, Hibbett Sports and City Gear stores started opening toward the end of April, keeping in mind local health guidelines. Currently, majority of its stores have reopened and are witnessing solid momentum. Also, increased focus on e-commerce operations by offering home delivery, buy online and pick-up in store, reserve online and pick-up in store, buy online ship to store, same-day delivery and mobile app services, to fulfill online orders and serve customers better bodes well.
Upbeat View
Hibbett’s enhanced omnichannel capabilities, improved supply-chain management, ability to provide in-demand products to customers and store reopening efforts are enabling it to combat the tough retail environment. Also, it expects the recently acquired City Gear business to contribute significantly to sales. During second-quarter fiscal 2021, the company envisions total comparable store sales (comps) to grow more than 70% year over year, with brick and mortar comps and online comps expected to rise nearly 60% and 200% year over year, respectively. Meanwhile, total comps for the first half of fiscal 2021 are projected to increase almost 20% year over year, with brick and mortar comps and online comps estimated to be up roughly 7% and 140%, respectively.
Notably, first-time customers are likely to contribute 25% of brick and mortar sales and roughly 40% of online sales. Overall, the Zacks Rank #2 (Buy) stock has surged 71.1% in the past three months, outperforming the industry’s growth of 28.7%.
Hurdles Persists
Despite interacting with vendors to manage inventory, the company anticipates inventory levels to be down significantly year over year. Apart from these, it had borrowed $50 million in the fiscal first quarter from its credit facility, which has now been repaid. Additionally, Hibbett is likely to incur costs related to increased business, leading to sturdy sales along with the implementation of safety protocols for employees and customers as well as employee benefits and compensation.
Alongside these, continued impacts from COVID-19 and the uncertainty looming over the back-to-school season have led management to refrain from providing fiscal 2021 guidance.
Other Stocks to Watch
Big Lots (BIG - Free Report) , a Zacks Rank #1 (Strong Buy) stock, has an expected long-term earnings growth rate of 7.1%. You can see the complete list of today’s Zacks #1 Rank stocks here.
Office Depot (ODP - Free Report) has an expected long-term earnings growth rate of 6.8% and a Zacks Rank #2.
Tractor Supply Company (TSCO - Free Report) has an expected long-term earnings growth rate of 12.3% and a Zacks Rank #2.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2021.
Click here for the 6 trades >>