U.S. stocks traded mixed Thursday, with major indices posting timid midday gains as investors digested fresh economic data revealing signs of consumer strain and disinflationary pressure stemming from April's tariff escalation.
Shares of sporting goods retailer Dick’s Sporting Goods (NYSE:DKS)
fell 14.2% in the morning session after the company announced the acquisition of footwear retailer Foot Locker for $2.4 billion. DKS would pay with some of its cash and take on new debt.
Foot Locker, Inc. (FL) shares soar on news of acquisition by Dick's Sporting Goods (DKS). Deal values FL at $2.4B and offers $24/share or 0.1168 DKS stock per FL share. DKS expects growth and cost synergies, sees Q1 sales growth and earnings beat, while FL projects Q1 loss.
Foot Locker shares are running after the market close on Wednesday following reports that Dick's Sporting Goods is nearing a deal to buy the footwear and apparel retailer.
Dick's currently trades at $212 and has been a dream stock for shareholders. It’s returned 683% since May 2020, blowing past the S&P 500’s 107% gain. The company has also beaten the index over the past six months as its stock price is up 7.4%.
Market swings can be tough to stomach, and volatile stocks often experience exaggerated moves in both directions.
While many thrive during risk-on environments, many also struggle to maintain investor confidence when the ride gets bumpy.
Corporate buybacks surged in April, led by Apple, Alphabet, and Wells Fargo, signaling confidence and boosting stock prices. Tech and consumer companies also joining the buyback binge.
Retailers are adapting their business models as technology changes how people shop. Still, demand can be volatile as the industry is exposed to the ups and downs of consumer spending.
This has stirred some uncertainty lately as retail stocks have tumbled by 11.8% over the past six months. This drop was worse than the S&P 500’s 2% fall.
Looking back on specialty retail stocks’ Q4 earnings, we examine this quarter’s best and worst performers, including Warby Parker (NYSE:WRBY) and its peers.
