Dick’s Sporting Goods retails athletic apparel, footwear, and equipment for sports. Dick’s operates digital platforms, about 725 stores under its namesake brand (including outlet stores), and about 130 specialty stores under the Golf Galaxy and Public Lands nameplates. Dick’s carries private-label merchandise and national brands such as Nike, The North Face, Under Armour, Callaway Golf, and TaylorMade. Based in the Pittsburgh area, Dick’s was founded in 1948 by the father of current executive chairman and controlling shareholder Edward Stack.

On Friday, the Bureau of Labor Statistics (BLS) likely will provide continuing evidence that the U.S. job market is healthy. The four-week average of initial jobless claims is running at 211,000, which is well below the 300,000 that might signal a critical weakening in employment conditions. The Layoffs and Discharges series in the BLS Job Openings and Labor Turnover Survey (JOLTS) was 1.57 million for January, below 1.61 million in December and below the average of 1.925 million since late 2000. Consumers aren't seeing much evidence of weakness either, according to last week's report on March Consumer Confidence from the Conference Board. Some 43.1% of consumers surveyed said jobs were "plentiful," up from 42.8% in February. Only 10.9% of consumers said jobs were "hard to get." Consumers' outlook for the job market in six-months softened slightly. While employers are keeping the workers they have, we aren't seeing indications of robust demand for new workers. The Institute for Supply Management's Manufacturing Employment Index was 47.4 for March, improved from February but suggesting a contracting market and soft manufacturing employment when the BLS reports on Friday. Tomorrow, the ISM will report on activity in the services sector, which is an important engine of GDP growth. The ISM Services Employment Index posted a contractionary 48 in February. We expect the BLS employment report on Friday will show that March payroll growth moderated to 180,000, from 275,000 in February, while the unemployment rate remained at 3.9%. We expect growth in average hourly earnings fell by one-tenth to 4.2%, and average hours declined to 34.2 from 34.3. The unemployment rate rose in February, but it did not trigger the Sahm Rule recession indicator. Based on our analysis, the March unemployment rate would need to rise to 4.4% to push the indicator to a recession signal.

The first quarter of 2024 was rewarding for equity investors, as the S&P 500 increased 10.2%. Much of the market participated, as the S&P 500 Growth Index advanced 12.6% and the S&P 500 Value Index rose 7.4%. Leading sectors included Communication Services (+15.6%), Energy (+12.7%), Technology (+12.5%), Financials (+12%), and Industrials (+10.6%). The average stock in the Argus Universe of Coverage rose 8.0% during the year, and the median stock advanced 7.2%. The average BUY-rated stock increased 9.9%, while the average HOLD-rated stock gained 3%. Will the market's breadth hold up for the balance of 2024 or will investors revert to the so-called Magnificent 7? Will small-caps pick up their pace (the Russell 2000 was up "only" 4.8% in 1Q) or is the current bull-market rally due for a break, with some profit-taking coming into play? Given declining interest rates, we expect growth stocks to continue to lead stocks higher, while the risk of recession puts a premium on clean balance sheets, which are also more prevalent among large-caps. Investors seeking value are encouraged to focus on dividends and look for yields in the 3%-4% range. Here are the Top 10 Performers from the Argus Universe last quarter (including representatives of six of the 11 major sectors) as well as the Bottom-Five Performers.

Small- and mid-cap stocks (SMID) have underperformed large-caps over the past 12 months, but may be in a better position to generate market-beating returns going forward. SMID companies tend to focus on domestic markets, so their businesses could be less disrupted by the fallout from global events. As well, the prices of SMID stocks generally are lower than the prices of large-caps. As well, there are long stretches in the record books when SMID stocks have outperformed large-caps. That said, SMID stocks can be risky. The standard deviation for monthly returns was 5.7% for SMID stocks over a 2003-2021 test period, versus 4.3% for large-caps. Still, despite the risks, diversified investors look to have exposure to small- and mid-caps based on the long-term performance record.