Big 5 Out Paces Competition

Tickers in this article: DKS CAB BGFV HIBB
NEW YORK ( TheStreet) -- I always take notice when a stock breaks from the pack and lately Big 5 Sporting Goods (BGFV) has out run the rest of the sporting goods pack.

After an earnings report that beat analysts' consensus expectations for both the top and bottom line, the stock price has soared while the rest of the industry is having problems. In the last two and a half months, while Big 5 Sporting Goods is up 43%, Cabela (CAB) is down 10%, Dick's Sporting Goods (DKS) is down 1% and Hibbett Sports (HIBB) is down 6%:

For those of you not familiar with the name, Big 5 has 406 stores in 12 western states and sells a full line of athletic and outdoor sporting goods. It offers growth with expansion left in the other 38 states.

Factors to Consider :

The stock has an 88% Barchart technical buy signal and a Trend Spotter buy signal. Trading above its 20-, 50- and 100-day moving averages the stock had five up days for a gain of 41.71% in the last month alone. The stock has a 69.52% relative strength index and Barchart computes a technical support level at 12.40. Recently it traded at 12.91 with a 50-day moving average of 10.06.

Fundamental factors :

Five Wall Street brokerage houses have assigned seven analysts to monitor the numbers and they look for a consensus earnings growth this year in excess of 30% while the price-to-earnings ratio is only 22.23 even with the recent run up in price.

Revenue is expected to grow 4% this year and another 4.6% next year. Earnings are the real story and are estimated to increase by 32.1% this year, another 21.4% next year and continue to increase by an annual rate of 11% for at least five years. The stock pays a 2.25% dividend. BGFV has a C++ financial strength rating and TheStreet rates this a C stock.

Investor interest is still growing and analysts have issued two buy, four hold and five under perform or sell recommendations to clients. The individual investor on Motley Fool has still not discovered the stock and only 123 readers have the stock on their watch lists, giving it a 63% confidence vote to beat the market. Analysts are scrambling to reanalyze this issue after Big 5 beat both top and bottom line consensus.

Competitive Factors :

As listed above the market has given the stock a thumbs up while it has seemed to pass on the rest of the sporting goods stocks. Some of it's competitors are listed below:

  • Cabela has a financial strength of B++ and is rated B by TheStreet Ratings. Revenue is projected to be up 10.30% next year and earnings looking to increase by 16.75% annually for the next five years.
  • Dick's Sporting Goods has a financial strength of B+ and TheStreet Ratings gives the stock an A-. Revenue is predicted to be up 8.1% next year and earnings might be up 14.79% annually for the next five years.
  • Hibbett Sports has a B++ financial strength and is rated B. Revenue is estimated to be up 6.6% next year and earnings to increase annually by 15.67% for the next five years out.