Big 5 Sporting Goods (BGFV) Misses Earnings; Guides Lower; Shares Dip

Bolton Flautt  |

Unfortunately, when companies miss on their earnings and issue guidance below forecasts, the resulting stock price is nearly always in the red.Big 5 Sporting Goods (BGFV) is down 15 percent in early trading at $10.25 per share on volume of 297,000 shares. Big 5 has a market capitalization of $224 million and an average daily volume of 247,753 shares. The company has a 52-week range between $8.52 and $15.47 per share.

Big 5 reported a lackluster loss per share of ($0.02) compared to analysts’ estimates of $0.01 per share. In the prior year quarter, the company had adjusted earnings per share of $0.14. Sales for the first quarter of 2016 were $234.5 million compared to sales of $243.6 million for the first quarter of 2015.

“After a very strong start to the first quarter as sales benefited from favorable winter weather in our markets, our winter product business decelerated when weather conditions turned warm and our non-winter product categories did not improve in the manner that we would have expected,” said Steven G. Miller, the Company’s Chairman, President and Chief Executive Officer, in a press release. “Sales have remained soft for the start of the second quarter, as the increased promotional activity associated with the ongoing competitor liquidation sales has continued.”

For the fiscal 2016 second quarter, the Company expects same store sales to be in the negative low single-digit to flat range and earnings to be in the range of $0.00 per share to $0.06 per share. This is well below the analysts’ estimates for a range between $0.64 per share and $0.67 per share for 2016.

During the first quarter of fiscal 2016, the Company closed four stores, one of which was part of a relocation, ending the quarter with 434 stores in operation. During the fiscal 2016 second quarter, the Company anticipates opening two new stores and closing one store. For the fiscal 2016 full year, the Company currently anticipates opening approximately five to eight new stores and closing approximately ten stores.

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