Putting on its best game face, Sports Authority (NYSE:TSA) had some good news and bad news to dish out as it huddled with shareholders last night. On the positive front, if you were to back out charges related to the company's recent acquisition of Gart Sports, the company produced better-than-expected third-quarter results.
The bad news? Well, retail is a lot like football in that the game is won or lost in the critical fourth quarter. On that end, Sports Authority will come up short as it is lowering its guidance. The leading sporting goods retailer is now looking to earn between $1.04 and $1.06 a share on $720 million in fourth-quarter sales.
With fiscal 2004 also now being targeted towards the low end of Wall Street's projections, is the company abandoning its game plan? Not likely. If anything, in a sector that is remembered more for its failures than its survivors, the fact that Sports Authority is profitable and actually growing its bottom line is commendable.
Think it's easy to sell athletic footwear and throwback jerseys? Think again. Competition is fierce as discount department stores such as Target (NYSE:TGT) and Kmart (NASDAQ:KMRT) mark down the basics. That doesn't mean the high end is any more lucrative, though. Concepts like Nike's (NYSE:NKE) NikeTown that seemed like slam dunks on paper haven't exactly flourished in limited rollouts.
But this is also a sector of opposites. Dick's Sporting Goods (NYSE:DKS) has been on a roll. While FootLocker (NYSE:FL) posted stellar results last month and now finds its stock trading at a five-year high, shares of rival Footstar (NYSE:FTS) are trading at a five-year low as it wades through the muck of financial restatements and changes at the helm.
It's fitting, I guess. There are winners and losers in every game.
What has Nike done to stay afloat since Michael Jordan's retirement? Come to think of it, how bad have the Chicago Bulls been since he's been gone? Who can stop the Lakers this year? All this and more -- in the NBA Discussions discussion board. Only on Fool.com.
