Market Insider

Shares of Hibbett plunge after fourth-quarter profit warning

Tunart | Getty Images

Shares of Hibbett Sports tumbled on Tuesday, after the company issued a profit warning for its fiscal fourth quarter and a worse-than-expected outlook for its 2018 fiscal year.

Shares closed 11.73 percent lower at $29.35.

"We were disappointed with sales in the fourth quarter. Weaker traffic during the holiday season and lower than expected sales in apparel and equipment led to a comparable-store sales decline," Jeff Rosenthal, president and CEO, said in a press release Monday.

The Alabama-based company saw same-store sales decline 2.2 percent compared with the same period a year earlier, and felt the negative impact of discounting on its bottom line. Those trends offset strength in its footwear business.

"The lack of an e-commerce business has continued to hurt Hibbett," Susquehanna analyst Sam Poser told investors. "We had not expected store traffic trends to deteriorate to this degree."

Poser downgraded Hibbett to "neutral" from "positive," and cut his price target from $45 to $32. SunTrust also cut its rating on the company to "hold" from "buy."

Analysts were expecting earnings of 59 cents per share during the holiday quarter, according to Thomson Reuters. But Hibbett now anticipates its fourth-quarter profit will range between 53 cents and 55 cents per share. Last year, the company reported earnings of 76 cents per share for the fiscal fourth quarter.

The sporting goods chain also adjusted its estimates for fourth-quarter revenue to $246.9 million. A consensus of analysts polled by Thomson Reuters had called for revenue of $254.2 million.

The retailer did not boost confidence with its weak guidance for 2018. Hibbett expects comparable store sales for 2018 to be flat or in the low-single digits, with earnings coming in between $2.65 and $2.85 per share.

Hibbett Sports will release its fourth-quarter earnings March 10.

Hibbett shares 5-day performance