Academy Sports and Outdoors (ASO): Target Hikes Follow Q2, but No Upgrades

On September 9, 2026, Academy Sports and Outdoors (ASO) released their second-quarter results for the period ending August 1, 2026. Net sales increased 3.0% to $1.65 billion, adjusted earnings per share rose 19.1% to $2.31 from $1.94, and the gross margin expanded 440 basis points to 40.4%. Management raised full-year adjusted EPS guidance to $6.50-$6.90 and gross margin guidance to 35.5%-36.0%.

However, what the quarter did not offer was a positive comparable sales figure, which fell 0.4%. Telsey Advisory observed that there was nothing to change their thesis, labeling the risk-reward attractive and maintaining an Outperform rating with a target price of $63 from $60. Wells Fargo's Ike Boruchow expressed cautious optimism, citing both the quarter's performance and management's forward guidance as delivering upside surprises. His target was raised to $55 from $50 with an Equal Weight rating.

Barclays analyst Adrienne Yih noted that despite a tougher consumer environment and slower sequential demand, ASO met its fiscal 2026 sales and comparable guidance. She lifted her target to $53 from $50 with an Equal Weight rating. The company's e-commerce sales grew 12.8%, Sports and Recreation sales rose 6%, and the myAcademy loyalty membership surpassed 15 million. The company also raised adjusted free cash flow guidance to $300 million-$350 million after repurchasing $182.1 million of stock in the first half.

UBS maintained a neutral stance, acknowledging encouraging margins and cash flow but questioning whether ASO can sustain growth through actual sales and demand rather than cost control and buybacks. BMO Capital initiated coverage with a Market Perform rating and a $42 target, warning that four years of failing to drive positive comps in a favorable athletic category makes the path harder now that the category is slowing. The company expects management to cut its FY26 outlook, which did not happen.

Hedge fund ownership of ASO fell to 29 funds from 31 between the first and second quarters of 2026, with the largest position held by Royce & Associates with 1.08 million shares worth $51 million. The current share price trades at 8.16 times forward earnings, and the short interest sits at 23.30% of the float. Every analyst who covered the stock after the earnings release raised their number, but none of them raised their rating.

The gap between the beat and the ratings suggests that the market still needs to see proof of ASO's raised guidance in the back half of the fiscal year.