On Monday, Hibbett Sports (NASDAQ:HIBB) experienced a shift as Williams Trading adjusted its stance on the company's stock. The firm downgraded the sports retailer from Buy to Hold and set a new price target of $73.00.
This decision was influenced by Hibbett's fourth-quarter fiscal year 2024 revenue, which did not meet the market's expectations, and the company's fiscal year 2025 guidance, which the analyst did not consider conservative.
Hibbett reported a 6.4% decrease in same-store sales (SSS) for the fourth quarter of 2024, with brick-and-mortar (B&M) same-store sales down by 9.2%. In contrast, the company's e-commerce sales saw an increase of 6.9%.
Looking ahead, Hibbett's fiscal year 2025 guidance anticipates total SSS to be flat or to decline by a low single-digit percentage, while B&M SSS is expected to follow the same trend. However, e-commerce sales are projected to grow by a mid to high single-digit percentage.
The company's guidance for total revenue in fiscal year 2025 is forecasted to be flat or increase up to 2%, ranging between $1.729 billion and $1.764 billion. Moreover, the earnings per share (EPS) are estimated to be between $8.00 and $8.75. These projections fall short of the consensus revenue and EPS estimates, which were set at $1.799 billion and $8.82 billion, respectively.
The revision of the stock rating and price target reflects the analyst's recalibration of expectations in light of Hibbett's recent performance and future outlook. This update to investors signals a more cautious view of the company's stock, suggesting that the market should temper its expectations for growth and profitability in the upcoming fiscal year.
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