Telsey on Academy Sports & Outdoors Inc. (ASO): 'Overall, earnings disappointed'
Telsey analyst Cristina Fernandez reiterated an Outperform rating and $83.00 price target on Academy Sports & Outdoors Inc. (NASDAQ: ASO).
The analyst comments "Overall, earnings disappointed in 4Q23 and are anticipated to come in lower than we and the Street had expected in 2024. That said, we are encouraged to see the comp improve sequentially in 4Q23 (-3.6% vs. -8.0% in 3Q23) and the potential for a return to a flattish or positive comp if the same trajectory continues, particularly as comparisons continue to ease. In addition, the company is managing its inventory prudently and promotional activity is controlled, with the gross margin guided to be flat-to-up. On the 10:00 AM ET call, we will listen for more color on: 1) demand trends through the quarter and by product category; 2) level of promotional and clearance activity and plans for 2024; 3) performance of new stores and cadence of 2024 store openings; 4) factors driving the gross margin and SG&A ratio; 5) inventory composition; and 6) merchandising initiatives. As usual, our estimates and 12-month price target are under review pending further details on the call."
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Shares of Academy Sports & Outdoors Inc. closed at $71.25 yesterday.