Shares of sporting goods retailer Hibbett Sports (NASDAQ:HIBB) rose 12% in December, according to data from S&P Global Market Intelligence. That capped a strong year for the stock, which rose roughly 65% in 2020. There was no dramatic news in December, but the retailer did file its quarterly earnings report with the Securities and Exchange Commission. It was good reading.
To be precise, Hibbett reported earnings in late November. So the news of its results wasn't new in December, but its SEC filing filled out what was a very good story.
To put some numbers on that, sales increased 20% year over year in the third quarter. Gross margin improved by 5.6 percentage points. And earnings exploded higher, hitting $1.47 per share compared to just $0.13 in the year-earlier period.
Impressively, the company was able to achieve these results despite the headwinds posed by the coronavirus pandemic. Meanwhile, there was upbeat news on the pandemic front, as progress continued in the deployment of vaccines.
Since Hibbett is a relatively small high-growth company (its market cap is just shy of $800 million), it shouldn't be surprising to see the stock move up and down in dramatic fashion. In fact, the stock witnessed a couple of notable ups and downs in December. But with a strong quarterly earnings report and continued vaccine deployment, investors clearly believe that this sports retailer is set to be a winner. And they are boosting the stock accordingly.
Consumers can be fickle, and retail stocks have a habit of coming in and out of favor. That said, Hibbett is clearly doing a good job of executing during what has been a very bad time for many retailers. That investors have rewarded it for this success is hardly surprising.