In a report released yesterday, Anna Glaessgen from B.Riley Financial maintained a Hold rating on Sportsman’s Warehouse (SPWH – Research Report), with a price target of $4.50.
Anna Glaessgen has given her Hold rating due to a combination of factors affecting Sportsman’s Warehouse. The analyst anticipates that the company’s efforts to enhance the customer experience through an improved merchandising strategy and inventory realignment will eventually lead to better comparable store sales (comp performance). However, these positive changes are expected to take time before they significantly impact comp sales. Furthermore, the company is grappling with a pressured consumer base and the ongoing effects of the COVID-19 pandemic’s demand surge, which are likely to prolong the timeline for recovery. Additionally, the return to historical profit margins is not anticipated until 2025, indicating a longer road to financial recovery for Sportsman’s Warehouse.
The hold rating also reflects the expectation that consumer demand in core outdoor product categories will remain subdued in 2024, with a full sales inflection not projected until 2025. While there is optimism around the company’s shift from store expansion to debt repayment and the hiring of new CEO Paul Stone, the turnaround is expected to be gradual amid challenging market conditions. Finally, the current valuation of Sportsman’s Warehouse’s stock is higher than its post-COVID trading range, and further expansion of the multiple is contingent upon more tangible signs of improvement in the company’s fundamentals.
Glaessgen covers the Consumer Cyclical sector, focusing on stocks such as Yeti Holdings, Fox Factory Holding, and Clarus. According to TipRanks, Glaessgen has an average return of -14.9% and a 37.84% success rate on recommended stocks.
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Sportsman’s Warehouse (SPWH) Company Description:
Sportsman’s Warehouse Holdings, Inc. engages in the retail of sporting and athletic goods through its wholly owned subsidiaries, Sportsman’s Warehouse, Inc., and Minnesota Merchandising Corp. Its products include hunting and shooting; archery; fishing; camping; boating accessories; optics and electronics; knives and tools; and footwear. The company was founded in 1986 and is headquartered in Midvale, UT.
Read More on SPWH:
- Sportsman’s Warehouse price target lowered to $6.50 from $7.00 at B. Riley
- Sportsman’s Warehouse Holdings, Inc. Announces Third Quarter 2023 Financial Results
- Sportsman’s Warehouse reports Q3 EPS (1c), consensus (12c)
- SPWH Earnings this Week: How Will it Perform?
- Sportsman’s Warehouse Holdings, Inc. Announces Third Quarter 2023 Earnings Conference Call
