ASO Stock Forecast & Price Target

Academy Sports is supported by an improving store base, with 2022–2025 openings reaching 47 stores at Q2:26 and management expecting those new stores to comp at a mid-single-digit rate, helping offset softer legacy traffic and drive a path to +1.7% to +1.8% comps in Q2–Q4:27. Its profitability outlook is also strengthening as gross margin benefits from mix shift toward premium Nike, Jordan, Brooks and Hoka merchandise, while Q2 gross margin of 40.4% included an IEEPA refund and underlying margin remained near 36.0%, reinforcing confidence in a 10% adjusted EBIT margin bridge. Capital allocation adds further support, with about half of CFO returned, diluted shares down from 94.3MM to 61.6MM, FY26E FCF of $345MM implying an ~8% yield, and a refreshed rewards program plus co-branded Mastercard aimed at lifting traffic and loyalty.

Academy Sports is facing a cautious fundamental outlook because its core middle-income customer base remains under pressure from a choppy macro environment, with recent slowdown in Truist Card Data and uncertainty around core demand outweighing modest near-term lifts from events and a raised low-end 2026 outlook. Its margin quality also looks less durable because tariff refunds have already been embedded into guidance, while broader promotions and higher fuel costs can offset reported gross margin strength, and elevated capex plus returns on invested capital still well below prior peaks limit long-term quality. In addition, new stores are opening at lower productivity, the store base is concentrated in Texas, and heavy share repurchases may reduce liquidity without solving underlying traffic, mix, and profitability risks.