On August 25, 2026, Dick's Sporting Goods experienced a historic 30% decline in its stock price following weaker-than-expected second-quarter earnings and a significant cut to its full-year profit outlook.
Cramer noted that while the core Dick's business showed resilience with a 4.9% increase in comparable sales, the acquisition of Foot Locker has led to challenges, as Foot Locker's comparable sales fell 3.6%. Cramer highlighted that the inventory issues and discounting across the athletic footwear and apparel sector are contributing to the difficulties faced by both companies.
He believes that despite the current struggles, Dick's remains a strong player in the sporting goods market and could recover in the long run, especially as the stock is now trading at approximately nine times 2027 earnings. Cramer advises investors to consider buying the stock during this downturn, as Dick's has a history of bouncing back from significant declines