Big 5 Sporting Goods (BGFV) is a leading sporting goods retailer in the western United States, operating 436 stores; t provides a full-line product offering in a traditional sporting goods store format that averages 11,000 square feet, explains Bill Mathews, a small cap expert and editor of The Cheap Investor.

Big 5’s product mix includes athletic shoes, apparel and accessories, as well as a broad selection of outdoor and athletic equipment for team sports, fitness, camping, hunting, fishing, tennis, golf, winter and summer recreation and roller sports.

The company sells private label merchandise under its own trademarks comprising Golden Bear, Harsh, Pacifica, and Rugged Exposure; and licensed trademarks, including Beach Feet, Bearpaw, Body Glove, Morrow, and The Realm.

We recommended the stock at $6.60 in the December 2017 issue. It moved up 44% to a high of $9.49, then it fell back with the release of lower revenues and earnings.

The company declared a quarterly cash dividend of $0.05 per share of outstanding common stock, which will be paid on December 14, 2018, to stockholders of record as of November 30, 2018. This dividend, which represents a reduction from the previous quarterly cash dividend rate of $0.15 per share, reflects the company’s intent to utilize capital to maintain a healthy financial condition.

For the fiscal 2018 fourth quarter, the company expects same store sales to be in the range of negative low single-digits to positive low single-digits and expects to realize a loss per share in the range of $0.15 to $0.25.

During the third quarter of fiscal 2018, Big 5 opened one store. It plans to open an additional store during the fiscal 2018 fourth quarter. For the fiscal 2018 full year, it anticipates opening four new stores and closing two stores. We would consider purchasing shares if the price fell to $3.40 or below.

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