Zacks Industry Outlook Highlights DICK'S Sporting Goods, Arhaus, Sally Beauty, and Build-A-Bear Workshop

For Immediate ReleaseChicago, IL – April 3, 2025 – Today, Zacks Equity Research discusses DICK'S Sporting Goods, Inc. DKS, Arhaus, Inc. ARHS, Sally Beauty Holdings, Inc. SBH and Build-A-Bear Workshop, Inc. BBW.Industry: Retail - MiscellaneousLink: https://www.zacks.com/commentary/2439135/4-retail-miscellaneous-stocks-bucking-the-trend-in-a-tough-marketThe Retail – Miscellaneous industry stands at a crossroads characterized by ongoing challenges and emerging prospects. Evolving consumer preferences, fierce competition and tariff policies are set to shape market trends. Inflationary pressures continue to impact consumer spending habits, fostering a climate of careful purchasing across diverse product lines.Escalating operational expenses, encompassing wages and raw material costs, are expected to persist as significant concerns. For the industry to gain momentum, restoring consumer confidence and purchasing power will be pivotal, alongside strategic innovations and operational efficiencies that can set the tone for a more resilient year ahead.Industry participants are addressing the changing consumer environment by emphasizing a superior product strategy, enhancing their omnichannel capabilities and making prudent capital investments. Backed by these initiatives, companies such as DICK'S Sporting Goods, Inc., Arhaus, Inc., Sally Beauty Holdings, Inc. and Build-A-Bear Workshop, Inc. are well-positioned to seize opportunities that may arise in this changed marketplace.About the IndustryThe Zacks Retail – Miscellaneous industry encompasses a diverse array of retailers, including those specializing in sporting goods, office supplies, specialty products and domestic merchandise. It also features beauty product retailers offering cosmetics, fragrances, skincare, haircare and salon styling tools.The industry also includes rural lifestyle stores, art and craft specialty outlets and suppliers catering to farmers, ranchers, tradesmen and small businesses. Recreational boat and yacht retailers, along with specialty value retailers targeting tween and teen customers, are also key players. Profitability within this sector hinges on a balanced pricing strategy, efficient supply-chain management, effective merchandising tactics and continuous innovation to meet consumer demands and maintain competitive positioning in a dynamic market.4 Key Industry TrendsSoft Demand May Hit Revenues: The effects of inflation and geopolitical concerns continue to impact consumer spending activity, which is crucial for the retail sector. The industry's outlook heavily relies on consumer purchasing power, now strained by higher prices that are putting pressure on family budgets and dampening demand. This situation is further compounded by a decline in U.S. consumer confidence.According to the latest data from the Conference Board, the index dropped 7.2 points to 92.9 in March, marking its fourth consecutive decline amid concerns over inflation and tariffs. The Present Situation Index, which evaluates consumer views on current business and labor market conditions, also fell by 3.6 points to 134.5.Pressure on Margins to Linger: Companies in the industry are competing on price, product variety and speed to market. To gain a competitive edge, they have been accelerating investments to strengthen the digital ecosystem and enhance shipping and delivery capabilities. While these efforts drive sales, they also incur high costs.Any deleverage in the SG&A rate, higher labor and occupancy costs, and increased marketing and store-related expenses may continue to pressure margins. Nonetheless, companies are focused on initiatives to mitigate cost-related challenges, such as streamlining operational structures, optimizing supply networks and adopting effective pricing policies.Focus on Boosting Portfolio & Market Reach: Most companies in the sector are focused on expanding their product assortment, enhancing the online shopping experience and adopting favorable pricing strategies to boost sales. Key initiatives include building robust omnichannel operations, introducing reward programs, and developing innovative products and services. There's a noticeable increase in demand for personal care items, domestic merchandise and fitness-related products. To capitalize on these trends, companies are leveraging targeted marketing efforts to fuel sales and broaden their market reach.Digitization, Key to Growth: With the shift in consumer shopping patterns and behavior, industry participants have been balancing in-store and online roles. Companies are increasingly directing resources toward digital platforms, accelerating fleet optimization and enhancing their supply chains. Initiatives to expand delivery options, such as curbside pickup and ship-to-home orders, along with contactless payment solutions, have proven beneficial.Retailers are also investing in store renovations, improved checkouts and mobile point-of-sale capabilities to keep physical stores relevant. By focusing on consumers' product preferences and their inclination toward online shopping, retailers are replenishing shelves with in-demand merchandise and ramping up investments in digitization to drive growth.Zacks Industry Rank Indicates Bleak ProspectsThe Zacks Retail – Miscellaneous industry is housed within the broader Zacks Retail – Wholesale sector. The industry currently carries a Zacks Industry Rank #156, which places it in the bottom 36% of roughly 250 Zacks industries.The group's Zacks Industry Rank, which is the average of the Zacks Rank of all the member stocks, indicates drab near-term prospects. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.The industry's positioning in the bottom 50% of the Zacks-ranked industries is a result of the negative earnings outlook for the constituent companies in aggregate. Looking at the aggregate earnings estimate revisions, it appears that analysts are losing confidence in this group's earnings growth potential. Since the beginning of July 2024, the industry's earnings estimate has declined by 11.5%.Before we present a few stocks that you may want to consider for your portfolio, let's take a look at the industry's recent stock-market performance and valuation picture.Industry vs. Broader MarketThe Zacks Retail – Miscellaneous industry has underperformed the broader Retail – Wholesale sector and the Zacks S&P 500 composite over the past year.The industry has declined 9% over this period. Meanwhile, the S&P 500 has risen 8.5%, and the broader sector has jumped 13.5% in the said time frame.Industry's Current Valuation   On the basis of forward 12-month price-to-earnings (P/E), which is commonly used for valuing retail stocks, the industry is currently trading at 16.14X compared with the S&P 500's 20.59X and the sector's 22.38X.Over the last five years, the industry has traded as high as 22.51X, as low as 12.05X and at the median of 17.12X.4 Stocks to WatchBuild-A-Bear Workshop: Build-A-Bear Workshop is leveraging its strong brand appeal and experiential retail model to drive sustainable growth. The company's focus on omnichannel expansion, digital innovation and strategic partnerships has enhanced customer engagement and operational efficiency. BBW continues to optimize its store fleet while exploring new revenue streams, including licensing and collaborations. Its disciplined approach to cost management and inventory control further supports profitability, positioning the company for long-term resilience despite broader economic headwinds.Build-A-Bear Workshop delivered positive earnings surprises in the last two reported quarters. The Zacks Consensus Estimate for Build-A-Bear Workshop's current financial-year revenues and earnings per share (EPS) suggests growth of 2.1% and 4% from the year-ago reported figure. Shares of this Zacks Rank #2 (Buy) company have rallied 38% in the past year. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.DICK'S Sporting Goods: Dick's Sporting Goods continues to strengthen its position as a top omnichannel sports retailer through strategic investments in innovation, customer engagement and market expansion. The company is enhancing brand loyalty with experiential store concepts like House of Sport and Field House, creating immersive shopping experiences. Its digital transformation, including e-commerce growth and robust fulfillment capabilities, ensures competitiveness in an evolving retail landscape. With increasing consumer demand for sports and active lifestyles, Dick's is well-positioned for sustained long-term growth.DICK'S Sporting Goods has a trailing four-quarter earnings surprise of 8.6%, on average. The Zacks Consensus Estimate for current financial-year revenues and EPS suggests growth of 3.1% and 1.9%, respectively, from the year-ago reported figure. Shares of this Zacks Rank #3 (Hold) company have declined 2% in the past year.Arhaus: Arhaus is driving growth through strategic showroom expansion and a strong focus on craftsmanship and innovation. By opening new locations in key markets and enhancing its immersive retail experience, the company is strengthening brand awareness and customer engagement. Its direct sourcing model and diversified supply chain support efficient scaling while maintaining high product quality. With disciplined investments and a clear long-term vision, Arhaus is well-positioned to expand its market presence and elevate its brand.Arhaus has a trailing four-quarter earnings surprise of 119.3%, on average. The Zacks Consensus Estimate for current financial-year revenues suggests growth of 8.1% from the year-ago reported figure. Shares of this Zacks Rank #3 company have fallen 43.4% in the past year.Sally Beauty: Sally Beauty's focus on customer engagement, innovation and brand evolution positions it for sustained growth. Through initiatives like Licensed Colorist OnDemand and partnerships with major digital platforms, the company strengthens its consumer connections and broadens its market reach. The introduction of new products and collaborations keeps Sally Beauty ahead of trends, while the upcoming brand refresh and store redesigns aim to enhance the customer experience. With a focus on high-margin brands and operational improvements, Sally Beauty is well-positioned for long-term growth and profitability.Sally Beauty has a trailing four-quarter earnings surprise of 1.6%, on average. The Zacks Consensus Estimate for current financial-year EPS suggests growth of 7.1% from the year-ago reported figure. Shares of this Zacks Rank #3 company have declined 17.1% in the past year.Why Haven't You Looked at Zacks' Top Stocks?Since 2000, our top stock-picking strategies have blown away the S&P's +7.7% average gain per year. Amazingly, they soared with average gains of +48.4%, +50.2% and +56.7% per year.Today you can access their live picks without cost or obligation.See Stocks Free >>Join us on Facebook: https://www.facebook.com/ZacksInvestmentResearch/Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.Media ContactZacks Investment Research800-767-3771 ext. 9339support@zacks.comhttps://www.zacks.comPast performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance  for information about the performance numbers displayed in this press release.Zacks' Research Chief Names "Stock Most Likely to Double"Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.This top pick is among the most innovative financial firms. With a fast-growing customer base (already 50+ million) and a diverse set of cutting edge solutions, this stock is poised for big gains. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.Free: See Our Top Stock And 4 Runners UpWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report DICK'S Sporting Goods, Inc. (DKS): Free Stock Analysis Report Sally Beauty Holdings, Inc. (SBH): Free Stock Analysis Report Build-A-Bear Workshop, Inc. (BBW): Free Stock Analysis Report Arhaus, Inc. (ARHS): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks