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Category: Sportsman's Warehouse (SPWH)
Date: 3 December2020 Stock Price of Sportsman's Warehouse: $13.99 We take a look at the 3rd quarter earnings report of their 2020 fiscal year of Sportsman's warehouse an outdoor sporting goods retailer focusing on hunting, shooting, fishing and camping gear. The group reported sales of $385.7 million and net income of $30.48 million.
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Sportsman’s Warehouse continued its exceptional performance in the third quarter of 2020. We were extremely pleased with the efforts of associates in all of our facilities as we worked as a team to safely and effectively serve customers, both new and returning - Jon Barker, Sportsman’s Warehouse CEO "
About Sportsman's Warehouse
Sportsman’s Warehouse is a high-growth outdoor sporting goods retailer focused on meeting the everyday needs of the seasoned outdoor veteran, the first-time participant, and every enthusiast in between. Our mission is to provide outstanding gear and exceptional service to inspire outdoor memories. We strive to accomplish this goal by tailoring our broad and deep merchandise assortment to meet local conditions and demand, offering everyday low prices, providing friendly support from our knowledgeable, highly trained staff, and offering extensive in-store events and educational programming. We offer a one-stop shopping experience that equips our customers with the right hunting, shooting, fishing, and camping gear to maximize their enjoyment of the outdoors. These core strategies help position Sportsman’s Warehouse as the “local outdoor experts” and the preferred place to both shop and share outdoor-based experiences in the communities we serve. As a result, we are expanding our loyal customer base in existing markets and increasing our store footprint in new markets. Sportsman’s Warehouse was founded in 1986 as a single retail store in Midvale, Utah; today we have the largest outdoor specialty store base in the Western United States and Alaska. Our principal executive offices are in Midvale, Utah.
Overview of Sportsman's Warehouse 3rd quarter 2020 earnings report
The data below refers to the latest quarter unless specified otherwise:
- Net sales: $385.7 million (up from $242.4 million for the same quarter in the previous year)
- Net sales increased by 59% over the last 12 months
- Cost of goods sold: $255.1 million (up from $158.3 million for the same quarter in the previous year)
- Cost of goods sold increased by 61.2% over the last 12 months
- Some margin squeeze for Sportsman's Warehouse as their cost of sales increased at a faster rate than their sales
- Net income: $30.482 million (up from $10.493 million for the same quarter in the previous year)
- Diluted earnings per share: $0.68 (down from $0.24 for the same quarter in the previous year)
- Diluted number of shares in issue: 44.510 million (up from 43.559 million for the same quarter of the previous year)
- Cash and equivalents: $19.314 million
- Cash and equivalents per share: $0.43
- Cash and equivalents makes up 3% of Sportsman’s Warehouse current market capital
- Cash and equivalents makes up 2.7% of Sportsman’s Warehouse total assets
- Merchandise Inventories: $322 million
- Inventories makes up 46.2% of Sportsman’s Warehouse total assets
- Stockholders equity in Sportsman’s Warehouse: $174.101 million
- Stockholders equity per share in Sportsman’s Warehouse: $3.91
- Sportsman’s Warehouse is trading at 3.57 times its stockholders equity per share which is within the expected range of between 2 and 5 times that most firms tend to trade at
- For some perspective firms in the Dow Jones trades at a price to book value of 4.25 times
Sportsman's Warehouse management commentary on their 3rd quarter 2020 earnings
WEST JORDAN, Utah, Dec. 02, 2020 (GLOBE NEWSWIRE) -- Sportsman's Warehouse Holdings, Inc. ("Sportsman's Warehouse" or the “Company”) (Nasdaq: SPWH) today announced financial results for the thirteen and thirty-nine weeks ended October 31, 2020.
“Sportsman’s Warehouse continued its exceptional performance in the third quarter of 2020. We were extremely pleased with the efforts of associates in all of our facilities as we worked as a team to safely and effectively serve customers, both new and returning,” said Jon Barker, Sportsman’s Warehouse CEO. “During the third quarter, same store sales increased 41% compared to the same period last year, driven by elevated participation in fishing, camping and hunting, and our continued market share gains in firearms.”
“Sportsman’s Warehouse continued its exceptional performance in the third quarter of 2020. We were extremely pleased with the efforts of associates in all of our facilities as we worked as a team to safely and effectively serve customers, both new and returning,” said Jon Barker, Sportsman’s Warehouse CEO. “During the third quarter, same store sales increased 41% compared to the same period last year, driven by elevated participation in fishing, camping and hunting, and our continued market share gains in firearms.”
Mr. Barker stated, “We continue to be excited about the expansion of our ecommerce capabilities, with ecommerce-driven sales up over 200% from the prior year period. We are also highly encouraged by the strong visitor traffic on both our website and inside of our stores. We opened 9 new stores year-to-date in 2020, taking the total Sportsman’s Warehouse store count to 111. In addition, our first Legacy Shooting Center, which opened earlier this year, is performing ahead of expectations.”
“We believe we are well positioned to continue to capitalize on substantial growth opportunities, including heightened participation in outdoor activities, ecommerce growth, and new store expansion to create long-term shareholder value.”
Balance sheet highlights as of October 31, 2020:
Fourth quarter and fiscal year 2020 outlook:
For the fourth quarter of fiscal year 2020, net sales are expected to be in the range of $356 million to $386 million based on same store sales growth in the range of 32% to 42% compared to the corresponding period of fiscal year 2019. Adjusted EBITDA is expected to be in the range of $31.0 million to $35.0 million with diluted earnings per share of $0.39 to $0.45 on a weighted average of approximately 44.5 million estimated common shares outstanding.
For fiscal year 2020, net sales are expected to be in the range of $1,370 million to $1,400 million based on same store sales growth in the range of 42% to 46% compared to fiscal year 2019. Adjusted EBITDA is expected to be in the range of $143.6 million to $147.2 million with adjusted earnings per diluted share of $1.87 to $1.93 on a weighted average of approximately 44.3 million estimated common shares outstanding (see “GAAP and Non-GAAP Measures”).
“We believe we are well positioned to continue to capitalize on substantial growth opportunities, including heightened participation in outdoor activities, ecommerce growth, and new store expansion to create long-term shareholder value.”
Balance sheet highlights as of October 31, 2020:
- The Company was in a net cash position at the end of the third quarter of 2020 with of $19.3 million in cash on hand, no borrowings under the Company’s revolving credit facility, and $8.0 million outstanding under the term loan, net of unamortized debt issuance costs. This is an improvement in net debt of $170.1 million year-over-year.
- Total liquidity was $238 million as of the end of the second quarter of 2020, comprised of $218 million of availability on the revolving credit facility and $19 million of cash on hand, compared to $80 million in total liquidity at the end of the third quarter of 2019.
Fourth quarter and fiscal year 2020 outlook:
For the fourth quarter of fiscal year 2020, net sales are expected to be in the range of $356 million to $386 million based on same store sales growth in the range of 32% to 42% compared to the corresponding period of fiscal year 2019. Adjusted EBITDA is expected to be in the range of $31.0 million to $35.0 million with diluted earnings per share of $0.39 to $0.45 on a weighted average of approximately 44.5 million estimated common shares outstanding.
For fiscal year 2020, net sales are expected to be in the range of $1,370 million to $1,400 million based on same store sales growth in the range of 42% to 46% compared to fiscal year 2019. Adjusted EBITDA is expected to be in the range of $143.6 million to $147.2 million with adjusted earnings per diluted share of $1.87 to $1.93 on a weighted average of approximately 44.3 million estimated common shares outstanding (see “GAAP and Non-GAAP Measures”).
Sportsman's Warehouse (SPWH) stock price history
The image below, obtained from Google, shows the stock price history of Sportsman's Warehouse over the last 5 years. And its been a pretty average time for Sportsman's Warehouse stockholders The group's stock traded at around $12 a stock 5 years ago and is currently trading at $13.99 a stock. That's a 16.5% provided to Sportsman's Warehouse Holdings stockholders over the last 5 years.
Sportsman's Warehouse stock is trading at closer to its 52 week high than it is to its 52 week low which is an indication that the short term sentiment and momentum of Sportsman's warehouse stock is positive at this point in time.
Sportsman's Warehouse stock is trading at closer to its 52 week high than it is to its 52 week low which is an indication that the short term sentiment and momentum of Sportsman's warehouse stock is positive at this point in time.
Recent coverage of Sportsman's Warehouse
The extract below discusses the latest regarding Sportsman's Warehouse as obtained from Nasdaq.com
Sportsman's Warehouse (SPWH) came out with quarterly earnings of $0.71 per share, beating the Zacks Consensus Estimate of $0.52 per share. This compares to earnings of $0.25 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of 36.54%. A quarter ago, it was expected that this outdoor sporting goods specialty retailer would post earnings of $0.32 per share when it actually produced earnings of $0.76, delivering a surprise of 137.50%. Over the last four quarters, the company has surpassed consensus EPS estimates four times.
Sportsman's Warehouse, which belongs to the Zacks Retail - Apparel and Shoes industry, posted revenues of $385.75 million for the quarter ended October 2020, surpassing the Zacks Consensus Estimate by 18.27%. This compares to year-ago revenues of $242.47 million. The company has topped consensus revenue estimates four times over the last four quarters.
Read the full article here
Sportsman's Warehouse (SPWH) came out with quarterly earnings of $0.71 per share, beating the Zacks Consensus Estimate of $0.52 per share. This compares to earnings of $0.25 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of 36.54%. A quarter ago, it was expected that this outdoor sporting goods specialty retailer would post earnings of $0.32 per share when it actually produced earnings of $0.76, delivering a surprise of 137.50%. Over the last four quarters, the company has surpassed consensus EPS estimates four times.
Sportsman's Warehouse, which belongs to the Zacks Retail - Apparel and Shoes industry, posted revenues of $385.75 million for the quarter ended October 2020, surpassing the Zacks Consensus Estimate by 18.27%. This compares to year-ago revenues of $242.47 million. The company has topped consensus revenue estimates four times over the last four quarters.
Read the full article here
Sportsman's Warehouse (SPWH) latest stock valuation
So what do we value Sportsman's Warehouse stock at based on their latest earnings release and the fiscal guidance provided by the group? Based on Sportsman's Warehouse latest earnings report and their fiscal guidance provided our valuation model provides a target price (full value price) for Sportsman's Warehouse stock at $21.10 a stock. We therefore believe the stock of Sportsman's Warehouse is undervalued at its current price
We usually recommend that long term fundamental or value investors look to enter a stock at least 10% below our target price which in this case is $21,10 A good entry point into Sportsman's Warehouse stock would therefore be at $19 or below.
Since the stock of Sportsman's Warehouse is trading at below our suggested entry point we rate the stock of Sportsman's Warehouse as a buy
We usually recommend that long term fundamental or value investors look to enter a stock at least 10% below our target price which in this case is $21,10 A good entry point into Sportsman's Warehouse stock would therefore be at $19 or below.
Since the stock of Sportsman's Warehouse is trading at below our suggested entry point we rate the stock of Sportsman's Warehouse as a buy
Next earnings release of Sportsman's Warehouse
It is expected that Sportsman's Warehouse will release their 4th quarter 2021 earnings report in late February 2021