This retail stock that’s more than doubled this year is still very cheap

Retail stocks have been losing traction as supply chain constraints and rising costs hit business last month. And yet, Bank of America suggests investors buy shares of Dick’s Sporting Goods Inc (NYSE: DKS) on a 20% dip since September 3^rd.

Bank of America sees upside to $160

In a note on Wednesday, analyst Robert Ohmes reiterated Dick’s Sports Goods at “buy” with a price target of $160 that represents a 35% upside from here.

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According to Ohmes, Dick’s is “particularly well-positioned” for the upcoming holiday season as it has limited exposure to Vietnam. Increased spending at stores also made him raise his same-store sales estimates for the sporting goods retailer.

Weiss agrees with the bullish call

On CNBC’s “Halftime Report”, Short Hills’ Stephen Weiss, who owns the stock, agreed with the bullish call saying the supply chain issues were temporary.

“Dick’s is under a new CEO, and she’s done a phenomenal job. They’ve got plans there to change the business. It’s a phenomenal stock, very cheap.”

Reasons why DKS is still cheap

Ohmes’ call is particularly bold, considering DKS has already more than doubled this year. But Weiss is convinced that the stock is still cheap relative to the earnings. He added:

Stocks can be cheaper as they move higher than they were when they were lower. If the earnings continue to go up and if you’re feeling better about going out to stores and they’ve got a great pickup at the curb process, then yes, it’s cheaper now than it was at the start of the year.