Dick’s Sporting Goods stock drops 30% as Cramer urges patience
Dick’s shares fell 30% after an earnings miss and outlook cuts, while Jim Cramer pointed to Foot Locker as the central problem.
By Jordan Bell · Startups & Deals Reporter
· 3 min read
Dick’s Sporting Goods stock fell 30% on Aug. 25 after the retailer missed Wall Street’s second-quarter expectations and cut key full-year outlooks. For investors watching the selloff, CNBC’s Jim Cramer argued that the company’s core chain held up better than the headline results suggest, while warning that the next one or two quarters could still be difficult.
The company reported adjusted earnings of $3.53 a share on $5.59 billion in revenue. Analysts surveyed by LSEG had expected $3.76 a share and $5.65 billion in revenue, CNBC reported. Dick’s also reduced its 2026 net-sales forecast to $21.9 billion to $22.2 billion, from $22.1 billion to $22.4 billion, and cut projected consolidated operating income to $1.45 billion to $1.55 billion from $1.69 billion to $1.81 billion.
Why did Dick’s Sporting Goods stock fall 30%?
The results exposed a growing divide between the company’s original Dick’s operations and Foot Locker, the footwear retailer it acquired in 2025. Dick’s said its core business posted 4.9% comparable-sales growth in the quarter, while Foot Locker’s pro forma comparable sales declined 3.6%.
Comparable sales are a retailer’s measure of sales performance across a comparable group of operations over time. The gap mattered because Foot Locker’s weakness pulled down the company’s broader outlook even as the main Dick’s chain continued to grow.
Dick’s maintained its forecast for 2.5% to 4% comparable-sales growth in the core business. It lowered Foot Locker’s outlook to a range of down 2% to flat, according to the company’s Aug. 25 earnings release.
Executive Chairman Ed Stack said a more promotional market for athletic footwear and apparel had affected Foot Locker more sharply because of its greater reliance on legacy shoe styles, launches and retro products. The company said fewer launches occurred in the quarter and those releases performed below its expectations.
Cramer’s case rests on the core business
Cramer’s view is a conditional long-term assessment, not a call that the decline has finished. He told CNBC that investors who do not already own the shares could consider buying over the coming months rather than rushing in immediately.
He cited the core chain’s 4.9% comparable-sales gain and Dick’s scale in sporting goods as reasons not to abandon the company. At the same time, he said Foot Locker is proving harder to repair than expected and described excess inventory and discounting across athletic footwear and apparel as risks for the near term.
CNBC reported that the selloff left Dick’s trading at roughly nine times 2027 earnings. That figure is one measure of valuation, but a lower multiple can reflect investors’ concern about future profits as well as a lower share price. Readers weighing such figures can review how to assess a P/E ratio alongside earnings quality, growth and business risk.
Cramer pointed to Dick’s 2023 post-earnings decline as historical context for his patience argument. That recovery does not establish that this selloff will follow the same path. The nearer tests are whether Foot Locker’s sales stabilize, discounting eases and Dick’s can meet its revised outlook.
This story draws on original reporting from CNBC.
