(DKS) Dick’s Sporting Goods Adds Three More Stores

Dick’s Sporting Goods Inc. (DKS), a full-line sporting goods retailer, continues to progress well with its growth initiatives, which include expanding its store base and strengthening its e-commerce business.

Following its rationale, the company opened three new stores (two in California and one in South Carolina). The company capitalizes on its extensive network of stores to effectively penetrate its target markets and gain a competitive advantage over its rivals and drive sales.

This is also well evident from the company’s recently concluded quarter, where net sales surged 10% to $1,437.0 million driven by a 3.8% rise in consolidated comparable-store sales (comps) and new store openings.

The opening of stores remains in sync with the company’s previously announced plan of opening 21 stores in the third quarter and relocating 3 of them. For fiscal 2012, the company plans to open approximately 38 Dick’s Sporting Goods stores. Moreover, the company plans to relocate about five Dick’s Sporting Goods stores and one Golf Galaxy stores in 2012.

In the long-term, the company aims at opening additional 400 stores, targeting a total store count of about 900 in the United States.

The company continues to establish a healthy vendor relationship and adding exclusive and more favorable product mix. Moreover, to generate incremental sales, Dick’s Sporting Goods continues to roll out its ‘store within a store program’ with Nike Inc. (NKE) and Under Armour Inc. (UA).

Dick’s Sporting Goods operates through 490 stores in 44 states. Additionally, the company operates 81 Golf Galaxy stores in 30 states.

Currently, we maintain our long-term Neutral rating on the stock. However, Dick’s Sporting Goods, which competes with Foot Locker Inc. (FL) and Wal-Mart Stores Inc. (WMT), holds a Zacks #2 Rank that translates into a short-term Buy recommendation

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