As the craze of earnings season draws to a close, here’s a look back at some of the most exciting (and some less so) results from Q3. Today, we are looking at specialty retail stocks, starting with Dick's (NYSE: DKS).

Some retailers try to sell everything under the sun, while others—appropriately called Specialty Retailers—focus on selling a narrow category and aiming to be exceptional at it. Whether it’s eyeglasses, sporting goods, or beauty and cosmetics, these stores win with depth of product in their category as well as in-store expertise and guidance for shoppers who need it. E-commerce competition exists and waning retail foot traffic impacts these retailers, but the magnitude of the headwinds depends on what they sell and what extra value they provide in their stores.

The 9 specialty retail stocks we track reported a mixed Q3. As a group, revenues missed analysts’ consensus estimates by 2.7%.

In light of this news, share prices of the companies have held steady as they are up 1.3% on average since the latest earnings results.

Weakest Q3: Dick's (NYSE: DKS)

Started as a hunting supply store, Dick’s Sporting Goods (NYSE: DKS) is a retailer that sells merchandise for traditional sports as well as for fitness and outdoor activities.

Dick's reported revenues of $4.17 billion, up 36.3% year on year. This print fell short of analysts’ expectations by 10.2%. Overall, it was a disappointing quarter for the company with full-year revenue guidance missing analysts’ expectations and a significant miss of analysts’ revenue estimates.

Dick's achieved the fastest revenue growth but had the weakest full-year guidance update of the whole group. The results were likely priced in, however, and the stock is flat since reporting. It currently trades at $208.07.

Is now the time to buy Dick's? Access our full analysis of the earnings results here, it’s free for active Edge members.

Best Q3: Ulta (NASDAQ: ULTA)

Offering high-end prestige brands as well as lower-priced, mass-market ones, Ulta Beauty (NASDAQ: ULTA) is an American retailer that sells makeup, skincare, haircare, and fragrance products.

Ulta reported revenues of $2.86 billion, up 12.9% year on year, outperforming analysts’ expectations by 5.2%. The business had an exceptional quarter with a solid beat of analysts’ EBITDA estimates and an impressive beat of analysts’ revenue estimates.

Ulta pulled off the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 9.4% since reporting. It currently trades at $586.65.

Is now the time to buy Ulta? Access our full analysis of the earnings results here, it’s free for active Edge members.

Bath and Body Works (NYSE: BBWI)

Spun off from L Brands in 2020, Bath & Body Works (NYSE: BBWI) is a personal care and home fragrance retailer where consumers can find specialty shower gels, scented candles for the home, and lotions.

Bath and Body Works reported revenues of $1.59 billion, flat year on year, falling short of analysts’ expectations by 2.7%. It was a disappointing quarter as it posted full-year EPS guidance missing analysts’ expectations and a significant miss of analysts’ EBITDA estimates.

As expected, the stock is down 6.7% since the results and currently trades at $19.62.

Read our full analysis of Bath and Body Works’s results here.

Sally Beauty (NYSE: SBH)

Catering to both everyday consumers as well as salon professionals, Sally Beauty (NYSE: SBH) is a retailer that sells salon-quality beauty products such as makeup and haircare products.

Sally Beauty reported revenues of $947.1 million, up 1.3% year on year. This number surpassed analysts’ expectations by 1.6%. Overall, it was a very strong quarter as it also recorded a solid beat of analysts’ EBITDA estimates and a beat of analysts’ EPS estimates.

The stock is up 2.7% since reporting and currently trades at $15.07.

Read our full, actionable report on Sally Beauty here, it’s free for active Edge members.

Best Buy (NYSE: BBY)

With humble beginnings as a stereo equipment seller, Best Buy (NYSE: BBY) now sells a broad selection of consumer electronics, appliances, and home office products.

Best Buy reported revenues of $9.67 billion, up 2.4% year on year. This print beat analysts’ expectations by 1%. It was a strong quarter as it also logged a solid beat of analysts’ EBITDA estimates and a narrow beat of analysts’ revenue estimates.

The stock is down 5.5% since reporting and currently trades at $71.46.

Read our full, actionable report on Best Buy here, it’s free for active Edge members.

Market Update

As a result of the Fed’s rate hikes in 2022 and 2023, inflation has come down from frothy levels post-pandemic. The general rise in the price of goods and services is trending towards the Fed’s 2% goal as of late, which is good news. The higher rates that fought inflation also didn't slow economic activity enough to catalyze a recession. So far, soft landing. This, combined with recent rate cuts (half a percent in September 2024 and a quarter percent in November 2024) have led to strong stock market performance in 2024. The icing on the cake for 2024 returns was Donald Trump’s victory in the U.S. Presidential Election in early November, sending major indices to all-time highs in the week following the election. Still, debates around the health of the economy and the impact of potential tariffs and corporate tax cuts remain, leaving much uncertainty around 2025.

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