Hold Rating on Hibbett Sports Amidst Acquisition by JD Sports: A Strategic Fit with Transitional Uncertainties

Williams Trading analyst Sam Poser has maintained their neutral stance on HIBB stock, giving a Hold rating today.

Sam Poser has given his Hold rating due to a combination of factors involving the acquisition of Hibbett Sports by JD Sports. The agreement, which sets the acquisition price at a significant premium over the recent closing share price, promises a notable change in Hibbett’s financial strategy, including the suspension of stock buybacks and dividend payments until the transaction is complete. This pause in shareholder returns could justify a more cautious stance, as it signals a period of transition and potential uncertainty for Hibbett Sports.
Moreover, the acquisition is seen as a strategic fit, given the similarities in customer demographics between Hibbett and JD’s other holdings, such as DTLR and Shoe Palace. Poser acknowledges Hibbett’s strong omnichannel presence, e-commerce platform, and mobile app, which are expected to enhance JD Sports’ operations. The potential for increased vendor leverage post-acquisition could position JD to gain market share, particularly against competitors like Foot Locker. These factors collectively suggest a period of adjustment and integration, which may warrant a Hold rating until the impacts of the acquisition become clearer.

In another report released today, B.Riley Financial also maintained a Hold rating on the stock with a $87.50 price target.

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Hibbett Sports (HIBB) Company Description:

Hibbett Sports, Inc. engages in the provision of sporting goods business. It features a core selection of brand name merchandise emphasizing athletic footwear, athletic and fashion apparel, team sports equipment, and related accessories. Its shopping channel includes store locations, and websites or apps. The company was founded in 1945 and is headquartered in Birmingham, AL.