Looking back on specialty retail stocks’ Q4 earnings, we examine this quarter’s best and worst performers, including Warby Parker (NYSE: WRBY) and its peers.
Some retailers try to sell everything under the sun, while others—appropriately called Specialty Retailers—focus on selling a narrow category and aiming to be exceptional at it. Whether it’s eyeglasses, sporting goods, or beauty and cosmetics, these stores win with depth of product in their category as well as in-store expertise and guidance for shoppers who need it. E-commerce competition exists and waning retail foot traffic impacts these retailers, but the magnitude of the headwinds depends on what they sell and what extra value they provide in their stores.
The 8 specialty retail stocks we track reported a satisfactory Q4. As a group, revenues along with next quarter’s revenue guidance were in line with analysts’ consensus estimates.
While some specialty retail stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 1.3% since the latest earnings results.
Warby Parker (NYSE: WRBY)
Founded in 2010, Warby Parker (NYSE: WRBY) designs, manufactures, and sells eyewear, including prescription glasses, sunglasses, and contact lenses, through its e-commerce platform and physical retail locations.
Warby Parker reported revenues of $190.6 million, up 17.8% year on year. This print exceeded analysts’ expectations by 1.9%. Despite the top-line beat, it was still a slower quarter for the company with a significant miss of analysts’ EPS estimates and a miss of analysts’ EBITDA estimates.
“Our strong 2024 results highlight the power of Warby Parker’s brand and unmatched value proposition combined with our team’s high-quality execution. We delivered on our ambitious goals to accelerate revenue growth, customer growth and glasses growth, all while maintaining operational discipline and expanding profitability,” said Co-Founder and Co-CEO Dave Gilboa.
Warby Parker achieved the fastest revenue growth and highest full-year guidance raise of the whole group. Still, the market seems discontent with the results. The stock is down 61.6% since reporting and currently trades at $15.78.
Is now the time to buy Warby Parker? Access our full analysis of the earnings results here, it’s free.
Best Q4: Sportsman's Warehouse (NASDAQ: SPWH)
A go-to destination for individuals passionate about hunting, fishing, camping, hiking, shooting sports, and more, Sportsman's Warehouse (NASDAQ: SPWH) is an American specialty retailer offering a diverse range of active gear, equipment, and apparel.
Sportsman's Warehouse reported revenues of $340.4 million, down 8.1% year on year, outperforming analysts’ expectations by 3.6%. The business had a stunning quarter with a solid beat of analysts’ EPS estimates and an impressive beat of analysts’ EBITDA estimates.
Sportsman's Warehouse delivered the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 61.6% since reporting. It currently trades at $1.56.
Is now the time to buy Sportsman's Warehouse? Access our full analysis of the earnings results here, it’s free.
Weakest Q4: Academy Sports (NASDAQ: ASO)
Founded in 1938 as a tire shop before expanding into fishing equipment, Academy Sports & Outdoor (NASDAQ: ASO) sells a broad selection of sporting goods but is still known for its outdoor activity merchandise.
Academy Sports reported revenues of $1.68 billion, down 6.6% year on year, in line with analysts’ expectations. It was a slower quarter as it posted full-year EPS guidance missing analysts’ expectations.
As expected, the stock is down 20.2% since the results and currently trades at $37.90.
Read our full analysis of Academy Sports’s results here.
Best Buy (NYSE: BBY)
With humble beginnings as a stereo equipment seller, Best Buy (NYSE: BBY) now sells a broad selection of consumer electronics, appliances, and home office products.
Best Buy reported revenues of $13.95 billion, down 4.8% year on year. This print beat analysts’ expectations by 2%. Zooming out, it was a satisfactory quarter as it also produced an impressive beat of analysts’ EBITDA estimates but full-year EPS guidance missing analysts’ expectations.
The stock is down 24% since reporting and currently trades at $66.
Read our full, actionable report on Best Buy here, it’s free.
Dick's (NYSE: DKS)
Started as a hunting supply store, Dick’s Sporting Goods (NYSE: DKS) is a retailer that sells merchandise for traditional sports as well as for fitness and outdoor activities.
Dick's reported revenues of $3.89 billion, flat year on year. This number topped analysts’ expectations by 3.2%. Aside from that, it was a mixed quarter as it also recorded a narrow beat of analysts’ gross margin estimates but full-year EPS guidance missing analysts’ expectations.
The stock is down 10.4% since reporting and currently trades at $189.51.
Read our full, actionable report on Dick's here, it’s free.
Market Update
Thanks to the Fed’s series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% in November), and a notable surge followed Donald Trump’s presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by potential trade policy changes and corporate tax discussions, which could impact business confidence and growth. The path forward holds both optimism and caution as new policies take shape.
Want to invest in winners with rock-solid fundamentals? Check out our Top 6 Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
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