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1. Company Snapshot

1.a. Company Description

Big 5 Sporting Goods Corporation operates as a sporting goods retailer in the western United States.The company's products include athletic shoes, apparel, and accessories.It also offers a selection of outdoor and athletic equipment for team sports, fitness, camping, hunting, fishing, tennis, golf, and winter and summer recreation, as well as home recreation.


The company also provides private label items, such as shoes, apparel, camping equipment, fishing supplies, and snow sport equipment.It sells private label merchandise under its own trademarks comprising Golden Bear, Harsh, Pacifica, and Rugged Exposure.As of May 03, 2022, the company operated 431 stores.


It also operates an e-commerce platform under the Big 5 Sporting Goods name.The company was founded in 1955 and is headquartered in El Segundo, California.

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1.b. Last Insights on BGFV

Big 5 Sporting Goods Corporation's recent performance was driven by the company's efforts to revitalize its inventory and optimize its store footprint. Management's focus on refreshing its product offerings and streamlining its store network is expected to drive recovery. Additionally, the company's commitment to improving its operational efficiency and cost structure will likely contribute to its future growth prospects. Furthermore, Big 5's ability to adapt to changing consumer preferences and trends in the sporting goods industry will be crucial in maintaining its market position.

1.c. Company Highlights

2. Big 5 Sporting Goods Battles Headwinds as Sales and Margins Decline in Q1 2025

Big 5 Sporting Goods reported a challenging Q1 2025, with net sales dropping to $175.6 million from $193.4 million in the prior year, reflecting a 9.3% decline. Same-store sales fell 7.8%, with significant weakness in winter-related categories, which plunged nearly 25% in January and February due to unfavorable weather comparisons. The company posted a net loss of $17.3 million, or $0.78 per share, widening from a $0.38 per share loss in Q1 2024. Despite beating consensus estimates for EPS by $0.01, the result underscores ongoing profitability pressures. Gross margin contracted 30 basis points to 30.9%, driven by mix shifts and promotional activity, while EBITDA turned negative at $12 million, highlighting the magnitude of the downturn.

Publication Date: May -01

📋 Highlights
  • Net Sales Decline: Net sales dropped to $175.6 million from $193.4 million YoY, reflecting a 9.3% decrease.
  • Same-Store Sales Drop: Same-store sales declined 7.8%, with winter-related categories down nearly 25% in Jan-Feb.
  • Margin Compression: Merchandise margins fell 78 basis points due to mix shifts and promotional activities.
  • Inventory Build-Up: Inventory rose 6.5% YoY, positioning for spring/summer sales and mitigating tariff impacts.
  • Worsening Net Loss: Net loss increased to $17.3 million, or $0.78 per share, from $8.3 million, or $0.38 per share, in Q1 2024.

Top-Line Challenges Persist Across Categories

The sales decline was broad-based, with hard goods, apparel, and footwear same-store sales dropping 4.7%, 8.7%, and 11.8%, respectively. Transactions fell 5.3%, and the average sale declined 2.5%, reflecting weaker consumer demand. However, March showed signs of stabilization, with same-store sales flat year-over-year, benefiting from the Easter calendar shift. This sequential improvement suggests some potential for recovery, but the macroeconomic environment remains uncertain. As CEO Steve Miller noted during the earnings call, "We are navigating a tough retail landscape, but we're taking steps to adapt and position the company for long-term success."

Margin Pressures and Inventory Management

Margins remained under pressure, with merchandise margins falling 78 basis points due to mix shifts and increased promotional activity. Inventory levels rose 6.5% year-over-year, driven by earlier seasonal receipts, which management believes will support spring and summer sales while mitigating tariff impacts. The company also closed eight stores during the quarter as part of its strategic store optimization plan, with seven more closures planned for the remainder of 2025. This initiative aims to reduce costs and improve profitability, though the near-term impact on sales remains a concern.

Outlook and Valuation Considerations

Looking ahead, Big 5 expects same-store sales to decline in the low to mid-single-digit range for Q2 2025, with a net loss per share anticipated between $0.75 and $0.90. The company is focused on managing controllable expenses and optimizing its store portfolio, but the challenging macroeconomic backdrop continues to weigh on performance. From a valuation perspective, the stock trades at a P/S ratio of 0.03 and EV/EBITDA of -7.59, reflecting significant distress. The dividend yield of 5.54% and free cash flow yield of -222.84% highlight the balance between income appeal and underlying financial strain. Investors appear to be pricing in a turnaround, but execution risks remain elevated.

3. NewsRoom

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Big 5 Sporting Goods Corporation Completes Merger With a Partnership Comprised of Worldwide Golf and Capitol Hill Group

Oct -02

Source: globenewswire.com

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Big 5 Sporting Goods Corporation Stockholders Approve Acquisition by Worldwide Sports Group Holdings LLC

Sep -26

Source: globenewswire.com

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Big 5 Sporting Goods Corporation Postpones Special Meeting of Stockholders; Urges Stockholders to Continue Voting “For” the Merger and Related Proposals at the Special Meeting

Sep -23

Source: globenewswire.com

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Shareholder Alert: The Ademi Firm Investigates Whether Big 5 Sporting Goods Corporation Is Obtaining a Fair Price for Its Public Shareholders

Aug -08

Source: businesswire.com

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Big 5 Incurs Wider Y/Y Loss in Q2 Amid Weak Sales, Plans Buyout

Aug -04

Source: zacks.com

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Big 5 Sporting Goods Corporation Announces Fiscal 2025 Second Quarter Results

Jul -29

Source: globenewswire.com

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Big 5 Sporting Goods Sold to Worldwide Golf for $112 Million

Jul -06

Source: pymnts.com

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$HAREHOLDER ALERT: Class Action Attorney Juan Monteverde Investigates the Merger of Big 5 Sporting Goods Corp. (NASDAQ: BGFV)

Jul -02

Source: globenewswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.79%)

6. Segments

Hardgoods

Expected Growth: 4.83%

The 4.83% growth in Hardgoods from Big 5 Sporting Goods Corporation is driven by increasing demand for outdoor recreation, fitness, and team sports equipment. Additionally, the company's focus on private label brands, strategic pricing, and effective inventory management have contributed to the growth. Furthermore, the rise of e-commerce and omnichannel retailing have also boosted sales.

Athletic and Sport Footwear

Expected Growth: 4.65%

The 4.65% growth in Athletic and Sport Footwear from Big 5 Sporting Goods Corporation is driven by increasing participation in fitness activities, popularity of athleisure wear, and innovative product offerings from key brands. Additionally, strategic marketing efforts and expanded online presence have contributed to the segment's growth.

Athletic and Sport Apparel

Expected Growth: 4.83%

The 4.83% growth in Athletic and Sport Apparel from Big 5 Sporting Goods Corporation is driven by increasing participation in outdoor activities, rising health awareness, and growing demand for athleisure wear. Additionally, strategic partnerships with popular sports brands, effective marketing campaigns, and expanding e-commerce presence contribute to the segment's growth.

Other

Expected Growth: 4.83%

The 4.83% growth in Other segment of Big 5 Sporting Goods Corporation is driven by increasing demand for outdoor recreation, expansion of e-commerce platform, and strategic partnerships with key vendors, resulting in higher sales of camping gear, bicycles, and fitness equipment.

7. Detailed Products

Fitness Equipment

Big 5 Sporting Goods Corporation offers a wide range of fitness equipment, including treadmills, ellipticals, exercise bikes, and home gyms from top brands.

Team Sports Equipment

The company offers a variety of team sports equipment, including baseball bats, gloves, and protective gear, as well as soccer, basketball, and football equipment.

Camping and Hiking Gear

Big 5 Sporting Goods Corporation offers a range of camping and hiking gear, including tents, sleeping bags, backpacks, and cooking equipment.

Fishing Gear

The company offers a variety of fishing gear, including rods, reels, lures, and tackle boxes.

Apparel and Footwear

Big 5 Sporting Goods Corporation offers a wide range of apparel and footwear, including athletic wear, outerwear, and casual wear from top brands.

Hunting Gear

The company offers a range of hunting gear, including firearms, ammunition, and archery equipment.

8. Big 5 Sporting Goods Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

Big 5 Sporting Goods Corporation faces moderate threat from substitutes, as customers have limited alternatives for sporting goods and outdoor recreation products. However, the rise of online marketplaces and direct-to-consumer sales by manufacturers may pose a threat to Big 5's business.

Bargaining Power Of Customers

Big 5 Sporting Goods Corporation has a large customer base, but individual customers have limited bargaining power due to the company's diversified product offerings and wide geographic presence.

Bargaining Power Of Suppliers

Big 5 Sporting Goods Corporation relies on a diverse supplier base, which reduces the bargaining power of individual suppliers. However, key suppliers may still exert some influence over pricing and product offerings.

Threat Of New Entrants

Big 5 Sporting Goods Corporation operates in a moderately concentrated industry, and new entrants face significant barriers to entry, including high startup costs and established relationships between suppliers and existing retailers.

Intensity Of Rivalry

Big 5 Sporting Goods Corporation operates in a highly competitive industry, with numerous retailers competing for market share. The company faces intense rivalry from specialty retailers, online retailers, and mass merchants.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 53.15%
Debt Cost 3.95%
Equity Weight 46.85%
Equity Cost 15.91%
WACC 9.55%
Leverage 113.43%

11. Quality Control: Big 5 Sporting Goods Corporation passed 1 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Honest

A-Score: 4.0/10

Value: 4.7

Growth: 6.0

Quality: 6.4

Yield: 0.0

Momentum: 4.5

Volatility: 2.7

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Stock-Card
1stdibs

A-Score: 3.9/10

Value: 8.4

Growth: 4.7

Quality: 5.2

Yield: 0.0

Momentum: 1.0

Volatility: 4.0

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Stock-Card
Big 5 Sporting Goods

A-Score: 3.7/10

Value: 9.8

Growth: 0.6

Quality: 3.6

Yield: 5.0

Momentum: 1.5

Volatility: 2.0

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Office Depot

A-Score: 3.3/10

Value: 6.6

Growth: 3.8

Quality: 2.9

Yield: 0.0

Momentum: 4.0

Volatility: 2.3

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1800Flowers

A-Score: 2.6/10

Value: 9.4

Growth: 1.0

Quality: 2.7

Yield: 0.0

Momentum: 0.5

Volatility: 2.0

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Stock-Card
A.K.A. Brands

A-Score: 2.3/10

Value: 7.2

Growth: 3.4

Quality: 2.2

Yield: 0.0

Momentum: 0.5

Volatility: 0.7

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

1.44$

Current Price

1.44$

Potential

-0.00%

Expected Cash-Flows