Goldman Sachs Raises Earnings Estimates and Price Target For Dick's Sporting Goods (DKS)

In a recent research report, Goldman Sachs raised its earnings estimates and price target for Dick's Sporting Goods (DKS).

“DKS' powerful earnings results, marked by a big sales and gross margin beat, speak to the promise of strong earnings power in 2011,” Goldman Sachs writes. “Sales ‘broke out' from typical seasonal trend by the biggest magnitude in three years, and the firm out-comped the sporting goods average by the widest spread in six quarters.

“While the firm printed 4Q EPS of $0.76 vs. $0.56 a year ago, holding expenses in line with our forecast plus some extra accrual for sales upside would have yielded EPS $0.11 higher.”

“We are raising estimates as follows: 2011 by $0.03, to $1.98; 2012 by $0.04, to $2.32,” Goldman added. “These increases reflect stronger sales and a higher gross margin partially offset by a slightly higher share count. We also introduce a 2013 estimate of $2.50. Our 12-month price target increases to $44 from $39 based on our new estimates and the roll forward of our risk/reward analysis.”

DKS is currently trading at $40.74.