Academy Sports and Outdoors (ASO) is likely to see a negative comparable sales in fiscal Q4, as pressures from the preceding quarter continued to drag its return to growth, UBS Securities said in a note emailed Tuesday.
The company's fiscal Q3 comparable sales declined as traffic trends were weighed down by higher prices that pressured core consumers, UBS noted. The investment firm estimates a 1% decline in fiscal Q4 comparable sales and 10 basis points to 20 basis points in gross margin expansion.
According to UBS, Academy Sports and Outdoors also has ongoing initiatives that could support its comparable sales growth, such as opening new stores and growing its e-commerce business. Other catalysts include potential sales from the world cup and upcoming tax refunds, the brokerage added.
Academy Sports and Outdoors is set to release its fiscal Q4 results on March 17.
UBS Securities raised its price target on Academy Sports and Outdoors to $60 from $54, and kept its neutral rating.
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