Stock Analysis

What Is DICK'S Sporting Goods, Inc.'s (NYSE:DKS) Share Price Doing?

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NYSE:DKS
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While DICK'S Sporting Goods, Inc. (NYSE:DKS) might not be the most widely known stock at the moment, it saw a decent share price growth in the teens level on the NYSE over the last few months. With many analysts covering the mid-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. However, could the stock still be trading at a relatively cheap price? Let’s examine DICK'S Sporting Goods’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.

See our latest analysis for DICK'S Sporting Goods

What Is DICK'S Sporting Goods Worth?

Good news, investors! DICK'S Sporting Goods is still a bargain right now. My valuation model shows that the intrinsic value for the stock is $154.87, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. However, given that DICK'S Sporting Goods’s share is fairly volatile (i.e. its price movements are magnified relative to the rest of the market) this could mean the price can sink lower, giving us another chance to buy in the future. This is based on its high beta, which is a good indicator for share price volatility.

What does the future of DICK'S Sporting Goods look like?

earnings-and-revenue-growth
NYSE:DKS Earnings and Revenue Growth November 14th 2022

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company's future expectations. However, with a negative profit growth of -13% expected over the next couple of years, near-term growth certainly doesn’t appear to be a driver for a buy decision for DICK'S Sporting Goods. This certainty tips the risk-return scale towards higher risk.

What This Means For You

Are you a shareholder? Although DKS is currently undervalued, the negative outlook does bring on some uncertainty, which equates to higher risk. Consider whether you want to increase your portfolio exposure to DKS, or whether diversifying into another stock may be a better move for your total risk and return.

Are you a potential investor? If you’ve been keeping tabs on DKS for some time, but hesitant on making the leap, I recommend you dig deeper into the stock. Given its current undervaluation, now is a great time to make a decision. But keep in mind the risks that come with negative growth prospects in the future.

If you'd like to know more about DICK'S Sporting Goods as a business, it's important to be aware of any risks it's facing. For example, DICK'S Sporting Goods has 4 warning signs (and 2 which shouldn't be ignored) we think you should know about.

If you are no longer interested in DICK'S Sporting Goods, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

What are the risks and opportunities for DICK'S Sporting Goods?

DICK'S Sporting Goods, Inc., together with its subsidiaries, operates as a sporting goods retailer primarily in the eastern United States.

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Rewards

  • Trading at 8.4% below our estimate of its fair value

Risks

  • High level of non-cash earnings

  • Significant insider selling over the past 3 months

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DICK'S Sporting Goods

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