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Big 5 Sporting Goods (BGFV) Target, Estimates Cut at Needham & Company Post Q4; 'Strong Buy' Maintained

February 26, 2014 6:41 AM EST Send to a Friend
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Price: $11.36 --0%

Rating Summary:
    2 Buy, 4 Hold, 1 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 16 | Down: 24 | New: 8
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Needham & Company analyst Sean McGowan reiterated a Strong Buy rating on Big 5 Sporting Goods (NASDAQ: BGFV) following Q4 results and weak guidance but cut its price target from $27 to $23.

"After previously announcing 4Q sales in mid-January, Big 5 issued weak guidance as the company anniversaries a difficult ammunition comparison and faces warm, dry weather in major markets," McGowa notes. "The company expects 1Q SSS to fall high single digits as firearms and ammunition (down 50%) and winter gear (down 30%) drag down results. We expect these struggles to be limited to the first quarter, and management expects to return to positive comps for the remainder of the year. Therefore, we maintain our Strong Buy rating (although we've lowered our target to $23) and believe future quarters will show greater strength."

The firm has lowered their sales and EPS estimates for 2014 and 2015, and are introducing estimates for 2016. They now see 2014 EPS of $1.30 on SSS up less than 1.2%, down from its prior estimate of $1.55 and SSS up over 3%, with the entire adjustment effectively coming in 1Q. For 2015, they now see EPS of $1.70, down from $1.90. For 2016, they forecast EPS of $2.10.

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 $15.88 yesterday.




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