Dick's Sporting Goods' stock slammed after earnings miss by a wide margin. The reason may be shoplifting.

Dick’s Sporting Goods Inc.’s stock tumbled 19% in premarket trade Tuesday, after the retailer’s second-quarter profit missed consensus by a wide margin, while sales also fell short.

Many retailers, including giant Walmart Inc. WMT, -0.27% and Target Corp. TGT, -2.61% have complained this earnings season about the growing problem of shrink, which can include damaged goods but increasingly refers to shoplifting, which companies say is being conducted by organized gangs. The issue is costing the sector billions of dollars a year, according to executives.

The NRF’s National Retail Security Survey, which was conducted with the Loss Prevention Research Council, found that retailers saw a 26.5% increase in organized retail crime incidents on average in 2021. Eight in 10 retailers surveyed also reported that violence and aggression associated with organized retail crime incidents had increased.

Sales rose 3.6% to $3.224 billion from $3.112 billion a year ago, just below the $3.238 billion FactSet consensus.“Despite moderating our 2023 EPS outlook, the enthusiasm we have for our business and the confidence we have in ourlong-term growth opportunities have never been stronger,” said Hobart.

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