ASO - Academy Sports and Outdoors Q1: Investors Are Impatient On The Wait For Growth Return

2024-06-12 01:45:46 ET

Summary

• Academy Sports and Outdoors reported Q1 results showing continued weakness as macroeconomic pressures on the consumer persist.
• The FY2024 guidance was reaffirmed, and with Q1 results only missing estimates slightly, I believe that the report was solid overall.
• The company targets aggressive retail location openings. With a demand recovery combined with long-term revenue growth, the stock has great upside even with more conservative estimates than is targeted.

Academy Sports and Outdoors, Inc. ( ASO ) retails sporting goods and outdoor recreational products and accessories in the United States including clothing, firearms, ammunition, grills, and a wide range of other products. ASO had an IPO in late 2020 and seems to have been mispriced in the listing by a wide margin – the stock has compounded at a CAGR of 46% since the IPO, appreciating by a total amount of 300%. The company also pays out a dividend with a currently small yield of 0.82% as much of ASO’s cash flows are spent on fueling future growth....

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