Let’s dig into the relative performance of Best Buy (NYSE: BBY) and its peers as we unravel the now-completed Q3 specialty retail earnings season.

Some retailers try to sell everything under the sun, while others—appropriately called Specialty Retailers—focus on selling a narrow category and aiming to be exceptional at it. Whether it’s eyeglasses, sporting goods, or beauty and cosmetics, these stores win with depth of product in their category as well as in-store expertise and guidance for shoppers who need it. E-commerce competition exists and waning retail foot traffic impacts these retailers, but the magnitude of the headwinds depends on what they sell and what extra value they provide in their stores.

The 9 specialty retail stocks we track reported a mixed Q3. As a group, revenues missed analysts’ consensus estimates by 2.7%.

In light of this news, share prices of the companies have held steady as they are up 1.3% on average since the latest earnings results.

Best Buy (NYSE: BBY)

With humble beginnings as a stereo equipment seller, Best Buy (NYSE: BBY) now sells a broad selection of consumer electronics, appliances, and home office products.

Best Buy reported revenues of $9.67 billion, up 2.4% year on year. This print exceeded analysts’ expectations by 1%. Overall, it was a strong quarter for the company with a solid beat of analysts’ EBITDA estimates and a narrow beat of analysts’ revenue estimates.

The stock is down 5.5% since reporting and currently trades at $71.46.

Is now the time to buy Best Buy? Access our full analysis of the earnings results here, it’s free for active Edge members.

Best Q3: Ulta (NASDAQ: ULTA)

Offering high-end prestige brands as well as lower-priced, mass-market ones, Ulta Beauty (NASDAQ: ULTA) is an American retailer that sells makeup, skincare, haircare, and fragrance products.

Ulta reported revenues of $2.86 billion, up 12.9% year on year, outperforming analysts’ expectations by 5.2%. The business had an exceptional quarter with an impressive beat of analysts’ EBITDA estimates and a solid beat of analysts’ revenue estimates.

Ulta delivered the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 9.4% since reporting. It currently trades at $586.65.

Is now the time to buy Ulta? Access our full analysis of the earnings results here, it’s free for active Edge members.

Weakest Q3: Dick's (NYSE: DKS)

Started as a hunting supply store, Dick’s Sporting Goods (NYSE: DKS) is a retailer that sells merchandise for traditional sports as well as for fitness and outdoor activities.

Dick's reported revenues of $4.17 billion, up 36.3% year on year, falling short of analysts’ expectations by 10.2%. It was a disappointing quarter as it posted full-year revenue guidance missing analysts’ expectations significantly and a significant miss of analysts’ revenue estimates.

Dick's delivered the fastest revenue growth but had the weakest full-year guidance update in the group. The stock is flat since the results and currently trades at $208.07.

Read our full analysis of Dick’s results here.

Warby Parker (NYSE: WRBY)

Founded in 2010, Warby Parker (NYSE: WRBY) designs, manufactures, and sells eyewear, including prescription glasses, sunglasses, and contact lenses, through its e-commerce platform and physical retail locations.

Warby Parker reported revenues of $221.7 million, up 15.2% year on year. This print came in 1.2% below analysts' expectations. Zooming out, it was a satisfactory quarter as it also produced a beat of analysts’ EPS estimates but full-year revenue guidance missing analysts’ expectations.

The company reported 2.66 million active customers, up 9.5% year on year. The stock is up 41.4% since reporting and currently trades at $26.94.

Read our full, actionable report on Warby Parker here, it’s free for active Edge members.

Sportsman's Warehouse (NASDAQ: SPWH)

A go-to destination for individuals passionate about hunting, fishing, camping, hiking, shooting sports, and more, Sportsman's Warehouse (NASDAQ: SPWH) is an American specialty retailer offering a diverse range of active gear, equipment, and apparel.

Sportsman's Warehouse reported revenues of $331.3 million, up 2.2% year on year. This result met analysts’ expectations. More broadly, it was a slower quarter as it produced full-year EBITDA guidance missing analysts’ expectations significantly.

The stock is down 40.6% since reporting and currently trades at $1.45.

Read our full, actionable report on Sportsman's Warehouse here, it’s free for active Edge members.

Market Update

In response to the Fed’s rate hikes in 2022 and 2023, inflation has been gradually trending down from its post-pandemic peak, trending closer to the Fed’s 2% target. Despite higher borrowing costs, the economy has avoided flashing recessionary signals. This is the much-desired soft landing that many investors hoped for. The recent rate cuts (0.5% in September and 0.25% in November 2024) have bolstered the stock market, making 2024 a strong year for equities. Donald Trump’s presidential win in November sparked additional market gains, sending indices to record highs in the days following his victory. However, debates continue over possible tariffs and corporate tax adjustments, raising questions about economic stability in 2025.

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