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How Dick’s Sporting Goods’ PE Multiple Compares

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Jul. 11 2018, Updated 2:45 p.m. ET

Forward PE multiples

Forward PE multiples, calculated by dividing a company’s stock price by analysts’ earnings estimates for the next four quarters, are among the most frequently used multiples for comparing companies in the same sector. As of July 9, Dick’s Sporting Goods (DKS) was trading at a 12-month forward PE multiple of 11.0x, 12.9% lower than its PE multiple on May 30 when it released in Q1 2018 results. In comparison, Foot Locker (FL) and Hibbett Sports (HIBB) had higher 12-month forward PE multiples of 11.4x and 12.5x, respectively, while Big 5 Sporting Goods’ (BGFV) was lower, at 10.3x.

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Analysts’ growth estimates

In fiscal 2018, analysts expect Dick’s Sporting Goods’ sales to rise 1.2% YoY (year-over-year) to $8.69 billion, and its adjusted EPS to rise 1.0% YoY to $3.04. The company is making several investments toward enhancing its digital and omnichannel capabilities and has been assigning more store space to private brands to boost its top line. It’s bettering its page layout and working on a faster checkout process.

Peer comparison 

In fiscal 2018, analysts expect Foot Locker’s sales to rise 0.1% YoY to $7.79 billion and its adjusted EPS to increase ~10% YoY to $4.52. Foot Locker expects double-digit percentage growth in its EPS in fiscal 2018, driven by improved sales and a reduced share count in the second half of the year.

Meanwhile, analysts expect Hibbett Sports’ sales to fall 1% YoY to ~$958.6 million in fiscal 2019, and its adjusted EPS to rise 12.3% YoY to $1.83. Management has projected EPS of $1.65–$1.95.

For Big 5 Sporting Goods, analysts expect sales to increase 1.0% YoY to $1.0 billion in fiscal 2018, and EPS to rise 21.4% YoY to $0.68. Management expects EPS of $0.04–$0.12.

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