Zacks Investment Research downgraded shares of Big 5 Sporting Goods Corp. (BGFV) from NEUTRAL to UNDERPERFORM on March 07, 2014, with a target price of $14.00.
The near-term prospects of Big 5 seem gloomy, given its projections for a taxing first-quarter fiscal 2014, which will be characterized by a continued decline in the demand for firearms and ammunition products and an unusually harsh winter in the western markets zone. As a result, the company expects comps to decline in the high single-digit range coupled with earnings of $0.05 – $0.11 per share for the first quarter. Additionally, tougher comparisons from the prior year given the heightened gun products demand exhibited last year and a favorable weather are expected to mar the company's results. Moreover, the entry of DICK's Sporting's into smaller and mid-sized markets and Sports Chalet and Sports Authority's venture into the small store format may take a toll on the company's performance. Taking cue from the troubles ahead, we have downgraded Big 5 to an Underperform recommendation.
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