7 Best Fitness and Gym Stocks to Buy

5. Dick’s Sporting Goods, Inc. (NYSE:DKS)

Number of Hedge Fund Holders: 34

Dick’s Sporting Goods, Inc. (NYSE:DKS) is the largest American sporting goods retailer, a position that it has held for nearly two decades. It started as a fishing gear shop in Binghamton, New York, and now deals in apparel, footwear, outdoor gear, and sports, fitness, and hunting equipment. It has over 800 stores in the country.

Dick’s Sporting Goods, Inc. (NYSE:DKS) operates 4 subsidiaries – Golf Galaxy, providing golf equipment, apparel, and accessories; Public Lands, focusing on outdoor gear and apparel; Going Going Gone, which gives discounted deals; and House of Sport, a newer concept that brings a wider selection and more high-end brands to consumers.

In FQ1 2024, the company generated $3.02 billion in revenue, beating analyst expectations by $80.33 million, with 6.2% year-over-year growth. The earnings per share also beat expectations at $3.30. Overall, the EPS is up by 262% in the post-pandemic period.

RetailDive reported that since 2019, spending on casual clothing has increased by 22.60% in the US, and Dick’s Sporting Goods, Inc. (NYSE:DKS) casual apparel sales went up by 123.3%. This added over $447 million to the company’s sales. It also has a mobile app, GameChanger, for youth sports, which drove strong sales as over 5 million unique users engaged and averaged 30 minutes per day on it across all sports.

In March, the CFO, Navdeep Gupta, said the company will increase capital investments in external and internal store expansions, and RetailDive reported that it plans to open around 40 locations within and beyond 2024.

In Q1, the company opened 2 “House of Sport” and “next-generation” stores each, and 3 new locations for “Golf Galaxy Performance Centers” were also added. 14 more of the next-generation 50K locations will be opened throughout 2024.

The company has also been closing on-site stores and promoting e-store sales. By Q1, it had a brick-and-mortar presence of 39.4 million square feet, compared to 39.2 million last year.

This is a prominent brand, growing in sales and becoming popular. Over the past 5 years, it has grown at a compound annual growth rate of 33.24%, and it’s likely to continue on this trajectory as management continues executing on the expansion and e-store sales fronts.