Big 5 Sporting (BGFV) Delivers Big Time in Q1 - Needham & Company

May 1, 2013 7:55 AM EDT Send to a Friend
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Price: $12.69 --0%

Rating Summary:
    1 Buy, 5 Hold, 1 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 11 | Down: 33 | New: 16
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Needham & Company boosted its price target on Strong Buy-rated Big 5 Sporting Goods (NASDAQ: BGFV) from $20 to $26 and strong SSS, Q1 results and guidance.

On the quarter, analyst Sean McGowan notes: BGFV reported 1Q results well ahead of guidance and consensus expectations. Sales rose 12.7% YoY to $246.3mm with SSS increasing 10.5%. 1Q guidance called for SSS up high single digits. Gross margins increased 180 bps YoY to 32.7% of sales and SG&A expense fell to 27.6% of sales from 30.5% during the same period one year ago. EPS were $0.34, which exceeded management’s prior guidance ($0.18-$0.24 including a $0.01 tax benefit) and consensus expectations ($0.21). For 2Q, the company expects SSS to increase in the mid-single digits with EPS of $0.20-$0.26.

McGowan comments, "While management added that there was some uncertainty in supplies of ammunition, which have been one of the recent sales drivers, the company believes there is still excess demand in the channel as our channel checks previously indicated. BGFV said that 2Q SSS were positive thus far due to normal weather and a favorable shift in the Easter holiday. We are significantly increasing our EPS estimates for 2013, 2014 and 2015, and have raised our price target from $20 to $26."

The firm raised FY 2013 EPS from $1.20 to $1.45, FY 2014 EPS from $1.40 to $1.75 and FY 2015 from $1.65 to $2.05.

For an analyst ratings summary and ratings history on Big 5 Sporting Goods click here. For more ratings news on Big 5 Sporting Goods click here.

Shares of Big 5 Sporting Goods closed at $16.80 yesterday.

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