On Thursday, Jefferies analyst Jonathan Matuszewski maintained a Buy rating on Academy Sports & Outdoors Inc. (NASDAQ:ASO) with a $66.00 price target. The endorsement comes as ASO shares have fallen approximately 14% from their recent peak, now trading at an estimated 8 times the projected 2025 earnings per share (EPS), which Matuszewski considers an attractive entry point for investors.
The analyst's optimism is partly driven by the performance of Academy Sports & Outdoors' loyalty program, which has rapidly expanded to around 11 million members in about six months. This growth is expected to have a more significant impact on the company's profit and loss statement in 2025.
Furthermore, Matuszewski suggests that while the Spring 2025 Nike (NYSE:NKE) refresh at ASO might not be a game-changer, it has the potential to attract more customers and increase sales conversions. The refresh is also anticipated to enhance Academy Sports & Outdoors' reputation as a valuable retail distribution partner among other industry vendors.
In addition to the loyalty program and brand partnerships, the analyst points to the increasing penetration of private labels as a positive trend. This strategy could help mitigate the challenges posed by tariffs and a potentially promotional market environment that might persist into the first half of 2025. Despite these headwinds, Jefferies believes that Academy Sports & Outdoors is well-positioned to maintain its momentum and deliver value to its shareholders.
In other recent news, Academy Sports & Outdoors Inc. has been the subject of several analyst reports. Loop Capital reiterated a Buy rating on Academy Sports, highlighting the company's improved price competitiveness and the potential for sales growth in Fiscal Year 2025. Meanwhile, Citi initiated coverage with a Buy rating, noting significant growth potential and the expectation of easing comp pressures in the fiscal year 2025.
TD Cowen adjusted its outlook on Academy Sports, reducing the stock's price target while maintaining a Hold rating. The firm cited the need for same-store sales improvement as a key factor for meeting future consensus estimates. Loop Capital also maintained a Buy rating, emphasizing the company's strong fundamentals and the potential for stock appreciation.
Baird maintained its Outperform rating on Academy Sports, despite reducing the price target. The firm expressed optimism regarding the company's potential for improvement in 2025, highlighting the company's strong free cash flow and the expansion of the Nike product assortment.
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