Dick's pulled the plug on selling assault-style weapons and now its hunting business is 'under significant pressure'
- Dick's Sporting Goods' decision to stop selling assault-style weapons is hurting its hunting business.
- The company decided to stop selling assault-style weapons after the school shooting in Parkland, Florida back in February.
- As a whole, first-quarter earnings were impressive.
- Watch Dick's trade in real time here.
Dick's Sporting Goods decided to stop selling assault-style weapons after the tragic school shooting in Parkland, Florida. But cutting the product from its shelves has proven to bea drag on its business.
After the February shooting, Dick's Chairman and CEO Edward Stack announced the company would stop selling assault-style rifles.
"We're staunch supporters of the Second Amendment - I'm a gun owner myself," Stack said on "Good Morning America." "We don't want to be a part of this story, and we have eliminated these guns permanently."
The sporting goods retailer showed a splendid first-quarter 2018 earnings report Wednesday, sending the stock up more than 20%, but gun sales weren't a part of that success.
"Our firearms policy changes impacted our hunt business which saw an accelerated decline," chief financial officer Lee Belitsky told analysts on the company's conference call. "We expect these businesses to remain under significant pressure throughout the remainder of the year."
Dick's raised it's earnings-per-share guidance for the full year to between $2.92 and $3.12, but Belitsky said the headwinds from lower gun sales are "incorporated in our full year outlook."
And since Dick's has indeed decided not to sell assault-style weapons, at least for the foreseeable future, it may be hard to go back to gun distributors in the future.
"We don't have the best relationship with the firearms manufacturers right now," Belitsky added.
Mossberg & Sons is a gun manufacturer that sold firearms to Dicks, and Belitsky isn't too sure where the manufacturer might stand on giving Dick's business. "Mossberg did indicate that they weren't going to sell us on a direct basis," Belitsky said.
Dick's is up 29.53% this year, largely due to Wednesday's earnings.
