Sports Authority (TSA ) reported first-quarter earnings per share from operations of 35 cents, vs. 18 cents a year ago. Banc of America cut its rating to neutral from buy.
Analyst Robert Ohmes says the sports goods retailer's 35-cents first-quarter EPS (excluding charges) were 1 cent below his above-consensus 36-cents estimate. Although the merger integration is on track, some bumps in road raise the near-term risk profile. He says expense synergies are being offset by below plan comps at both Gart and acquired TSA stores with execution strains from merger initiatives.
Ohmes says the resignation of Elliot Kerbis implies an adjustment period as the company searches for a new head merchant.
He cut his 72-cents second-quarter EPS estimate to 70 cents and $2.70 fiscal year 2005 forecast to $2.65. He believes the shares are fully valued at current levels; he has a $36 price target.