Telsey Advisory Group downgraded Dick’s Sporting Goods Inc. to Market Perform from Outperform on Wednesday, citing a delayed recovery at Foot Locker and a broader slowdown in athletic apparel and footwear demand.
The firm cut its price target on the stock to $145 from $255, reflecting concerns over Foot Locker’s integration and weaker-than-anticipated performance in the lifestyle footwear segment. Analyst Cristina Fernández noted that the turnaround at Foot Locker, acquired last year, is now expected to take several additional quarters to materialize.
Dick’s Sporting Goods reported a 4.9% comparable sales increase for its core business on Tuesday, exceeding expectations, driven by World Cup-related merchandise and strength across apparel, footwear, and hardlines. However, Telsey emphasized that this growth has not offset broader softness in the athletic retail sector, particularly in high-volume legacy lifestyle footwear brands such as Nike, adidas, and New Balance.
Fernández attributed the slowdown to shifting consumer preferences toward dressier styles and a lack of product innovation in legacy segments. While demand remains resilient in certain niches—including low-profile shoes, Mary Jane styles, adidas prints, Nike Mind, and performance footwear—this has not been sufficient to counterbalance weakness in core lifestyle footwear categories.
The slowdown intensified through the second quarter and is not confined to Nike, with adidas and New Balance also experiencing pressure. On and Hoka, however, continued to perform relatively well. Telsey expects Dick’s Sporting Goods to trade within a range until Foot Locker demonstrates sustainable growth, though the firm maintains a long-term view of potential market share gains through improved marketing, store experience, and product assortment.
The analyst also reduced Dick’s 2026 earnings estimate to $11.50 per share from $14.30, reflecting the delayed recovery trajectory at Foot Locker and broader sector headwinds.
