Advertisement
Singapore markets open in 2 hours 12 minutes
  • Straits Times Index

    3,314.05
    +0.57 (+0.02%)
     
  • S&P 500

    5,308.13
    +4.86 (+0.09%)
     
  • Dow

    39,806.77
    -196.82 (-0.49%)
     
  • Nasdaq

    16,794.88
    +108.91 (+0.65%)
     
  • Bitcoin USD

    69,691.84
    +3,366.90 (+5.08%)
     
  • CMC Crypto 200

    1,489.84
    +135.43 (+10.00%)
     
  • FTSE 100

    8,424.20
    +3.94 (+0.05%)
     
  • Gold

    2,431.80
    -6.70 (-0.27%)
     
  • Crude Oil

    79.65
    -0.15 (-0.19%)
     
  • 10-Yr Bond

    4.4370
    +0.0170 (+0.38%)
     
  • Nikkei

    39,069.68
    +282.30 (+0.73%)
     
  • Hang Seng

    19,636.22
    +82.61 (+0.42%)
     
  • FTSE Bursa Malaysia

    1,627.50
    +10.88 (+0.67%)
     
  • Jakarta Composite Index

    7,266.69
    -7,317.24 (-50.17%)
     
  • PSE Index

    6,682.78
    +64.09 (+0.97%)
     

Hibbett's (HIBB) Strategic Efforts Seem Good: Apt to Hold

Hibbett, Inc. HIBB appears well-poised for growth, thanks to its robust business strategies. The company has been gaining from its e-commerce initiatives and store expansion efforts. Also, the smooth execution of the company’s business strategies, with the effectiveness of its approach to maneuvering a tough retail environment, has been yielding. Its footwear category has been a key driver.

Shares of this current Zacks Rank #3 (Hold) company have surged 53.7% in the past six months compared with the industry's 31.2% growth. A VGM Score of A further adds strength.

Let’s Delve Deeper

Hibbett is encouraged by the progress on the e-commerce front and the expansion of the loyalty program. It remains focused on increasing its customer base by connecting with more customers through e-commerce and selective store expansion. Further, it has been leveraging its omnichannel capabilities such as home delivery, buy online and pick-up in store, reserve online and pick-up in store, buy online ship to store facility, same-day delivery and mobile app services to fulfill online orders and serve customers.
 
E-commerce sales rose 6.9% year over year in fourth-quarter fiscal 2024, driven by better inventory, robust traffic across website and app, as well as improved digital customer experience. E-commerce accounted for 18.9% of overall sales in the 14 weeks ended Feb 3, 2024, up from 17.4% in the 13 weeks ended Jan 28, 2024. Management anticipates e-commerce sales to increase in mid to high-single digits in fiscal 2025.

Zacks Investment Research
Zacks Investment Research


Image Source: Zacks Investment Research

ADVERTISEMENT

The company is progressing well with its loyalty program, backed by higher members shopping on continued engagement from its existing members and average ticket growth on increased average unit retail. HIBB has been making improvements to the loyalty program, evident from its partnership with Nike’s loyalty program. This will further distinguish the company’s retail experience, as customers can sign up to be connected members either in-store or online.

Regarding its store expansion efforts, Hibbett has been gaining from a small market strategy as it continues to strengthen its presence across the country. The company targets expansion in markets that offer increased potential for growth. It has a target of growing to more than 1,500 stores in underserved markets. In fourth-quarter fiscal 2024, the company opened 14 stores. For fiscal 2025, net new store growth is likely to be 45-50 units. For fiscal 2025, capital expenditure is expected to be $65-$75 million for investment in new stores, remodels, technology advancement and infrastructure.

Hibbett is also focused on improved expense management and disciplined inventory controls. In fiscal 2025, the gross margin is likely to improve nearly 40-70 basis points year over year to 34.2-34.5%. For fiscal 2025, Hibbett expects net sales to be between flat and a 2% rise year over year. Earnings are anticipated to be $8-$8.75 per share for the fiscal year compared with $8.17 per share earned in the last fiscal year.

Eye These Solid Picks

We have highlighted three better-ranked stocks, namely American Eagle AEO, Gap GPS and Deckers DECK.

American Eagle, a leading apparel retailer, currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for American Eagle’s current financial-year sales suggests growth of 3.3% from the year-ago reported figure. AEO delivered an earnings surprise of 22% in the last reported quarter.

Gap, a leading apparel retailer, currently sports a Zacks Rank of 1. GPS delivered an earnings surprise of 180.9% in the trailing four quarters.

The Zacks Consensus Estimate for Gap’s financial-year sales suggests growth of 0.3% from the year-ago reported figure.

Deckers, a footwear and accessories dealer, currently carries a Zacks Rank #2 (Buy). DECK delivered an earnings surprise of 32.1% in the trailing four quarters.

The Zacks Consensus Estimate for Deckers’ current financial-year sales suggests growth of 15.8% from the year-ago reported figure.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

American Eagle Outfitters, Inc. (AEO) : Free Stock Analysis Report

Deckers Outdoor Corporation (DECK) : Free Stock Analysis Report

The Gap, Inc. (GPS) : Free Stock Analysis Report

Hibbett, Inc. (HIBB) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research