Market Overview

Brian Sozzi: It Would Make Sense For Dicks Sporting Goods To Go Private

Share:
Brian Sozzi: It Would Make Sense For Dicks Sporting Goods To Go Private

Speaking to Benzinga, Belus Capital Advisors CEO Brian Sozzi said that it would make sense for Dicks Sporting Goods Inc (NYSE: DKS) to go private.

Earlier Wednesday, Reuters reported that Dicks is in discussions with some buyout firms about going private.

Sozzi said there are a number of structural problems with the company, including its buy-level giant stores and lack of customer service.

He explained that competing sports and fitness retailers like Nike Inc (NYSE: NKE) and Under Armour Inc (NYSE: UA) have been aggressively opening their own retail stores that offer a better assortment of products.

But Sozzi warned that while Dicks executives will want to take the company private to cash in on profits, private equity firms may not be as interested in the retailer. He estimated about a 25 percent chance that the retailer gets bought out.

“If I’m a private equity planner, I would almost rather take something like Abercrombie & Fitch,” Sozzi said. “At least with Abercrombie & Fitch you have a true, international, well-known brand.”

Shares of Dicks were trading 8.6 percent higher after the buyout rumors.

The rest of the retail sector was also performing well: Nike was up 2 percent, Under Armour was 3.5 percent higher and Abercrombie & Fitch Co. (NYSE: ANF) was trading up 1.45 percent.

Image credit: Mike Mozart, Flickr

Latest Ratings for DKS

DateFirmActionFromTo
Mar 2020NomuraMaintainsNeutral
Mar 2020NomuraMaintainsNeutral
Mar 2020Morgan StanleyMaintainsEqual-Weight

View More Analyst Ratings for DKS
View the Latest Analyst Ratings

 

Related Articles (DKS)

View Comments and Join the Discussion!

Posted-In: abercrombie & fitch Belus Capital AdvisorsAnalyst Color News Retail Sales Exclusives Analyst Ratings Trading Ideas Best of Benzinga

Latest Ratings

StockFirmActionPT
ONNeedhamMaintains17.0
MCHPNeedhamMaintains96.0
MOHB of A SecuritiesUpgrades
NBRVNeedhamDowngrades
SAGECanaccord GenuityMaintains80.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Daily Analyst Rating
A summary of each day’s top rating changes from sell-side analysts on the street.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at vipaccounts@benzinga.com