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On the heels of last Friday’s disappointing Q4 results and soft FY25 profit guidance, Hibbett (NASDAQ:HIBB) was hit with a pair of downgrades on Monday.
Shares are lower by 3% and in the red for a fourth consecutive day. Since reporting results, Hibbett (HIBB) shares have traded 10% lower.
Telsey Advisory Group anticipates 2024 to be a more difficult year for the sportswear retailer, exacerbated by a cautious consumer and not as much “newness” in the market, while the negative impact from wage inflation and investments in technology will further pressure Hibbett’s (HIBB) operating margin.
In its latest quarterly report, Hibbett (HIBB) said it expects the company’s operating margin in fiscal 2025 to contract by another 50-90 basis points to 7.0% to 7.4% from7.9% in 2024, and comparable sales to be flat to down low single digits.
“Until [there are] signs of accelerating comp growth, it will be hard for the stock to work,” Telsey Advisory Group said in a research note on Monday.
Telsey downgraded Hibbett (HIBB) to Market Perform from Outperform and dropped its price target by 9.7% to $74. Williams Trading, which lowered its FY25 guidance for Hibbett (HIBB), downgraded the stock to Hold from Buy and set a $73 price target.
Analysts are mostly bullish on Hibbett (HIBB) with Seeking Alpha authors and Wall Street analysts rating the stock as a Buy. Seeking Alpha's Quant Rating views Hibbett (HIBB) as a Hold.