Sporting-goods retailer Big Five Sporting Goods (NASDAQ:BGFV) made the round trip on its guidance, hitting each of the bases on same-store sales (up 3.8%), earnings per share ($0.34 a stub), and revenues (up 8% year over year). While these numbers proved right in line with analyst expectations, the company appeared to stumble on its way to home plate. Continued higher costs at its new distribution center ate into margins, and the company warned that its fourth quarter would be weaker than usual.

That reduced guidance for the rest of the fiscal year may weigh on Big Five's stock for awhile. The fourth quarter generally assumes greater importance for the retailer, since the holiday shopping season is the biggest sales event for winter sporting goods. But in recent years, that fourth quarter has provided a steadily shrinking contribution to total revenues. In 2002, the fourth quarter represented 26.5% of the year's total revenues, growing to 27.8% in 2004. However, last year it dropped back to below 27% of the total, and this year's lowered guidance may portend a more difficult Christmas season.

The sales trends may mean that the company is doing a better job of spreading its sales out over the other three quarters, but they more likely represent the intense competition in the sporting-goods industry. Consumers have a choice of shopping at direct competitors like Dick's Sporting Goods (NYSE:DKS), Gander Mountain (NASDAQ:GMTN), or privately held The Sports Authority, or they can access online or catalog retailers like Cabela's (NYSE:CAB) or The Sportsman's Guide.

Moreover, Big Five also faces intense competition from mass retailers like Wal-Mart (NYSE:WMT) and Target (NYSE:TGT), both of which realize significant amounts of revenue from their sporting goods section.

While Big Five has 336 stores (and expects to open nine more by year's end), it is concentrated in 10 Western states, presenting both an obstacle and an opportunity. It constrains the retailer's ability to reach a larger segment of the sporting population, but the company's conscientiously managed growth has left many, many markets in which it can continue to grow.

This quarter's same-store sales increase marked Big Five's 43rd consecutive quarter of positive comps, a significant achievement which underscores management's goal of only expanding into areas that can sustain a store. Its new distribution center, which currently remains a costly transition, should ultimately streamline inventory distribution to its stores; at present, the facility already serves 98% of them. Still, the costs of the center are draining gross profits, with margins dropping to 34.8%, versus the 35.6% it recorded in the same period last year.

After the market closed yesterday and the company reported results, the stock dropped nearly 9%, although it recovered to a mere 2% sell-off at the open. That means that Big Five is trading at more of a discount to its competitors than it was just yesterday, which I find pretty compelling. The company continues to grow and expand, sales continue to rise, and same-store sales remain strong.

Big Five is not in danger of folding its tent, although if the stock remains depressed, it could always mark it as an acquisition target. A wave of consolidation has swept the industry in the past few years; should Big Five's valuation get cheap enough, it might have difficulty defending itself against a suitor. However, investors looking for a quick return on their investment might just see that as a home run.

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Fool contributor Rich Duprey owns shares of Wal-Mart -- a Motley Fool Inside Value holding -- but does not own any of the other stocks mentioned in this article. You can see his holdings here. The Motley Fool has a disclosure policy.