Academy Sports and Outdoors, Inc. (ASO) Exceeds Second Quarter Earnings Estimates – September 7, 2022


Sports & Outdoors Academy, Inc. (ASO Free Report) came out with quarterly earnings of $2.30 per share, beating Zacks consensus estimate of $2.07 per share. That compares to earnings of $2.34 per share a year ago. These figures are adjusted for non-recurring items.

This quarterly report represents an earnings surprise of 11.11%. A quarter ago, this company was expected to post a profit of $1.40 per share when it actually produced a profit of $1.73, delivering a surprise of 23.57%.

In the past four quarters, the company has exceeded consensus EPS estimates four times.

Sports and Outdoors Academy, Inc., which is owned by hobby and leisure products industry Zacks, posted revenue of $1.69 billion for the quarter ended July 2022, missing Zacks’ consensus estimate by 0.56%. That compares to revenues of $1.79 billion a year ago. The company has exceeded consensus revenue estimates three times in the past four quarters.

The sustainability of the immediate stock price movement based on recently released numbers and future earnings forecasts will primarily depend on management’s comments on the earnings call.

Shares of Academy Sports and Outdoors, Inc. are down about 4.5% year-to-date compared to the -18% decline in the S&P 500.

What’s next for Academy Sports and Outdoors, Inc.

With Academy Sports and Outdoors, Inc. outperforming the market so far this year, the question on investors’ minds is: what’s next for the stock?

There are no easy answers to this key question, but one reliable metric that can help investors answer it is the company’s earnings outlook. This includes not only the current consensus earnings expectations for the upcoming quarter(s), but also how those expectations have changed recently.

Empirical research shows a strong correlation between short-term stock movements and trends in earnings estimate revisions. Investors can track these revisions on their own or rely on a proven scoring tool like Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.

Prior to this earnings release, the trend in estimate revisions for Academy Sports and Outdoors, Inc. Mixed. While the magnitude and direction of estimate revisions may change following the release of the company’s earnings report, the current situation translates into a Zacks No. 3 (hold) ranking for the stock. Thus, the shares should move in line with the market in the near future. You can see the full list of today’s Zacks #1 Rank (Strong Buy) stocks here.

It will be interesting to see how the estimates for the next few quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $1.59 on $1.55 billion in revenue for the upcoming quarter and $6.98 on $6.59 billion in revenue for the current fiscal year.

Investors should be aware that the outlook for the sector can also have a significant impact on stock performance. In terms of Zacks industry rankings, hobby and leisure products currently sit in the bottom 44% of Zacks more than 250 industries. Our research shows that the top 50% of industries ranked by Zacks outperform the bottom 50% by a factor of more than 2 to 1.

Another stock in the same industry, MasterCraft Boat Holdings, Inc. (MCFT Free Report), has yet to report its results for the quarter ended June 2022. The results are expected to be released on September 8.

The sports boat maker is expected to post quarterly earnings of $1.49 per share in its next report, representing a year-over-year change of +52%. The consensus EPS estimate for the quarter has been revised upwards by 0.9% in the past 30 days from the current level.

MasterCraft Boat Holdings, Inc. revenue is expected to be $195.11 million, up 25.5% from the prior year quarter.


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