Dick’s Sporting Goods: We Upgrade Our Moat Rating to Narrow From None, but Shares Still Expensive

We are changing our moat rating for Dick’s Sporting Goods to narrow moat from our prior no moat rating based on a brand intangible asset. Although sporting goods are sold through many channels, we believe that the firm has built a competitive advantage. The retailer is a key destination for consumers and athletic apparel and equipment vendors, standing resilient while many peers have shuttered. We believe consumers are drawn to its vast, on-trend product assortment and differentiated in-store experience and service model, which fosters brand loyalty. Meanwhile, vendors see Dick’s as a reliable partner for reaching and engaging with consumers, leveraging the firm’s store-within-a-store model to showcase a wide range of products, including exclusives.