Baird Maintains Neutral Rating on Dick’s Sporting Goods but Sees Long-Term Upside

Baird analysts reiterated their Neutral rating and a $235 price target on Dick’s Sporting Goods (NYSE:DKS), balancing near-term challenges with potential long-term growth opportunities.

While top-line growth indicators showed a sequential slowdown, the analysts expressed confidence in Dick’s ability to meet third-quarter expectations and reaffirm its fiscal 2024 guidance. The stock’s approximately 16% decline since its better-than-expected second-quarter results, compared to a 3% gain in the retail index (XRT), has been driven by concerns over slowing comparable sales, increased SG&A reinvestment, and tariff-related pressures.

Despite these headwinds, Dick’s Sporting Goods remains a dominant market share leader. The ongoing expansion of its House of Sport concept represents a promising multi-year growth driver for profitability. With shares trading at less than 14 times next-twelve-month earnings—below its pre-COVID five-year average of approximately 13 times despite structurally improved margins and returns on invested capital—the analysts see growing potential for long-term value, even as near-term caution persists.