On Friday, TD (TSX:TD) Cowen showed confidence in Academy Sports & Outdoors Inc. (NASDAQ:ASO), increasing the stock's price target from $67.00 to $86.00. The firm has kept its Outperform rating on the shares. This adjustment reflects a positive outlook on the company's performance, as the analyst noted improvements in fourth-quarter trends based on checks and data.
The evaluation by TD Cowen suggests that Academy Sports & Outdoors has seen favorable movements in the market, which could influence the initial fiscal year 2024 guidance. The analyst's decision to raise the price target is rooted in various factors, including consumer preference for sporting goods, potential market share gains, and financial estimates that surpass the consensus.
According to the analyst, the new price target of $86.00 is based on 11 times the expected earnings per share (EPS) for fiscal year 2025 and 7 times the enterprise value to earnings before interest, taxes, depreciation, and amortization (EV/EBITDA). These multiples still represent a discount compared to Dick's Sporting Goods (NYSE:DKS) and other larger-cap retailers, suggesting room for growth in Academy Sports & Outdoors' stock valuation.
The analyst's commentary highlights the importance of current market trends and the company's positioning within the sporting goods sector. The assessment indicates that despite the uncertainties of first-quarter performance, the longer-term outlook for Academy Sports & Outdoors remains robust.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.