What Happened?

Shares of sporting goods retailer Dick’s Sporting Goods (NYSE:DKS) jumped 5.2% in the afternoon session after data from Adobe Analytics, which tracks retail transactions, revealed that shoppers spent a record $10.8 billion online on Black Friday (2024), representing more than a 10% growth compared to the previous year, and more than double what consumers spent in 2017. 

This is a bullish 'read-through' for retailers and aligns with some of the positive sentiments and holiday spending trends observed by some of the companies that have reported this earnings season.

The shares closed the day at $215.35, up 3.8% from previous close.

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What The Market Is Telling Us

Dick’s shares are not very volatile and have only had 8 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business. 

The biggest move we wrote about over the last year was 6 months ago when the stock gained 17.3% on the news that the company reported a "beat and raise" quarter. First-quarter revenue and EPS exceeded analysts' expectations. Looking ahead, guidance was strong. The company raised its full-year revenue and earnings guidance, beating Wall Street's estimates, as it expects its same-store sales to rise by 2.5% year on year. As a reminder, same-store sales growth is more profitable than growth from new locations because it's less capital intensive. Overall, we think this was a really good quarter that should please shareholders.

Dick's is up 47.5% since the beginning of the year, but at $215.36 per share, it is still trading 10% below its 52-week high of $239.18 from August 2024. Investors who bought $1,000 worth of Dick’s shares 5 years ago would now be looking at an investment worth $4,671.

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