Why Academy Sports Stock Is Rising Today

Academy Sports And Outdoors Inc ASO reported a second-quarter FY23 sales decline of 6.2% year-on-year to $1.58 billion, in line with the analyst consensus estimate.

Adjusted EPS of $2.09 beat the analyst consensus of $1.99.

Comparable sales declined 7.5%. Gross margin expanded 30 basis points Y/Y to 35.6%, and gross profit fell 5.5% to $563.45 million.

Also Read: Academy Sports And Outdoors Extends Partnership With Digital Sports Platform Fanatics

Operating margin compressed from 15.2% to 13.3%, and operating income for the quarter plunged 17.8% to $210.96 million.

During Q2, Academy opened one new store, bringing the total quarter-end number of stores to 270. 

Adjusted EBITDA for the quarter totaled $248.85 million.

The company exited the quarter with cash and equivalents worth $311.34 million.

Michael Mullican, President, said, "In the second quarter we made significant progress in aligning our expenses with our current sales trends. Our operating margin improved 420 basis points from the first quarter, driven by higher gross margin, sequential improvement in shrink as a rate to sales and disciplined expense management."

Outlook: Academy Sports increased adjusted EPS guidance for FY23 to $6.95-$7.65, versus the consensus of $6.92 (prior view: $6.80-$7.50).

Academy Sports reiterated FY23 net sales guidance of $6.175 billion-$6.365 billion versus the consensus of $6.23 billion.

The company reiterated a comparable sales decline of 7.5%-4.5%.

Academy Sports expects to open six stores in Q3, five to six in Q4, and 120 to 140 stores over the fiscal year ending with fiscal 2027.

Price Action: ASO shares traded higher by 12.54% at $56.20 premarket on the last check Thursday.