Staff Member
Diamond Supporter
Platinum Supporter
Bronze Supporter
- Messages
- 12,559
- Reactions
- 18,017
The stock price plummeted 18% after a quarter-to-quarter gain still fell short of expectations. It's the worst day of trading in company history and executives painted a bleak picture going forward.
"It's going to be painful for a while," said Dick's Chief Executive Officer Edward Stack.
He lowered Dick's earnings guidance by 17% for the year because of a slump in hunting sales and sporting apparel.
"The hunting business was very soft, and [same-store] sales declined double digits," said Chief Finance Officer Lee Belitsky in an earnings call, noting that the decline was "worse than expected."
The hunting category includes not only camouflage clothes, deer blinds, trail cameras, duck decoys and tree stands, but also guns. The company sells rifles, shotguns and black-powder guns typically used for hunting, including "small frame" rifles for kids.
Demand for hunting gear has been trending down. Dick's plunge follows anemic earnings earlier this month from Cabela's (CAB), a retailer of guns and other hunting products, and Sturm Ruger (RGR), a gun manufacturer. The Federal Bureau of Investigation reported a plunge in background checks for gun purchases in July.
He said that too much supply has led to "promotional pricing" in the hunting industry to try and get rid of the "inventory overhang."
Dick's stock plunges on poor gun and sports sales