If you’re a fan of hunting, fishing, and camping, there’s a good chance you know about Sportsman’s Warehouse. They’ve been a familiar name in outdoor gear for decades especially if you live west of the Mississippi. But if you’ve checked the news, scrolled through finance forums, or glanced at their stock price lately, you might be asking: Is Sportsman’s Warehouse going out of business in 2024? Let’s look at what’s really happening, why the company’s in the spotlight, and what shoppers, investors, and outdoor fans need to know.
So, Where Do Things Stand with Sportsman’s Warehouse in 2024?
The short answer: No, Sportsman’s Warehouse isn’t going out of business as we close out 2024. You’re still going to see their doors open, the website running, and the stacks of camo jackets and ammo boxes ready for early-morning hunting trips.
But it’s not all business as usual. The company is under some real financial pressure probably more than most of its rivals. Analysts who look at retail bankruptcy risk say Sportsman’s Warehouse sits at about a 36% chance of bankruptcy within the next two years. So, not a foregone conclusion, but definitely more than just “normal bumps in the road.”
What’s Driving the Risk? The Numbers Don’t Lie
Let’s break it down: If you scan the company’s financial statements, red flags start popping up. Their operating margin (how much the store keeps after covering core business costs) is negative: -1.23%. Same story with net margin, which is at -3.05%. For non-finance folks, this just means that for every $100 in sales, the company is actually losing money after it pays the bills.
It gets a little worse when you look at how efficient the company is at using its assets and shareholders’ money. Return on assets (ROA) is at -4.07%, and return on equity (ROE) clocks in at -17.05%. Those are deep underwater numbers compared to outdoor industry peers.
Stocks have taken a beating too. The company’s share price is down about 38% so far this year, and over the full twelve months, shares have dropped 19%. At the end of 2024, Sportsman’s Warehouse stock trades for only about 5 cents per $1 of sales what investors call a 0.05 price-to-sales ratio. It basically signals that Wall Street has very little confidence right now.
Liquidity Is Tight: A Look at Cash and Credit
Running an outdoor retail chain isn’t just selling tents and lures. It’s about managing cash and credit, especially when business is tough. The company’s quick ratio is stuck at 0.02. If that sounds low, that’s because it is meaning, they don’t have much cash compared to the bills they might need to pay at short notice. Their current ratio is at 1.20, so technically they can just cover their short-term debts, but it doesn’t leave much breathing room.
Like a lot of retailers, Sportsman’s Warehouse relies on a revolving credit line (specifically an “asset-based loan” or ABL). Theirs is set at $350 million and runs until 2027, with about $111 million in room as of late 2024. Think of it as the company’s safety net they’re not out of money, but things are tight enough to force delayed openings and rethink every spending move.
Why Sales Are Down: Post-COVID Slump and Inventory Headaches
The real pain started after the pandemic, when shoppers stopped splurging on camping gear and new hunting rifles. After a burst of spending in 2020 and 2021, Sportsman’s Warehouse and most outdoor retailers saw customers cut back. That’s led to slow-moving inventory. The company’s having a tough time turning over its stock, with inventory sitting about 183 days on average before it sells. That chews up cash and makes their stores feel a bit overstuffed.
Operating costs haven’t helped either, especially as rents, wages, and shipping costs have all jumped post-pandemic. Add in high “SG&A” the industry way of describing everything from staff pay to advertising and profits were squeezed even harder.
If you peek at the projected EBITDA (that’s a fancy Wall Street metric for core earnings before a bunch of accounting stuff), it’s only expected to reach $24 million for full-year 2024. That’s just a 1.9% margin pretty slim for a retailer that once did much better.
Some History and Recent Changes: Bankruptcy Isn’t New Here
If the term “bankruptcy” sounds familiar for Sportsman’s Warehouse, there’s a reason. The company actually filed Chapter 11 back in 2008 when the mortgage crisis tanked retail sales. Back then, a big private equity player swooped in, restructured the company, and set it back on track.
Since then, the company’s tried to leap ahead with new stores and a spot in the growing group of specialty outdoor chains. But it hasn’t always worked out. In 2021, Great Outdoors Group parent of Cabela’s and Bass Pro Shops actually tried to buy out Sportsman’s Warehouse, but the FTC waved that off over antitrust worries. Another deal fell apart in 2020, right as COVID changed everything about how Americans shop.
New leadership arrived in late 2023, when Paul Stone (known in retail circles for a tough streak) took over as CEO. One of his first big decisions: Stop opening new stores in 2024 to preserve cash. This marked a pretty sharp shift from past years, when Sportsman’s Warehouse set its sights on rapid expansion.
Can Sportsman’s Warehouse Turn Things Around? Possible Scenarios
Now, here’s where things get interesting. Most experts don’t expect the company to vanish overnight, but talk about “strategic alternatives” fills up research reports. What does that mean for you, the customer? It might just mean things keep going as is. Or, Sportsman’s Warehouse could pursue a few options:
- Out-of-Court Restructuring: This would involve drumming up more cash from existing lenders, tweaking lease deals, and cutting costs so the business survives without a formal bankruptcy.
- Chapter 11 Bankruptcy (Again): If things don’t improve, they could follow other retailers into formal bankruptcy court. That typically lets them renegotiate debts, shut down underperforming stores, and exit bankruptcy as a leaner company.
- Buyout or Sale: Interest from other industry giants or private equity could still emerge, especially if regulators see less antitrust risk than last time.
It’s worth mentioning that Sportsman’s Warehouse does pop up on more than a few “2026 Bankruptcy Watch” lists among retail analysts. But none have evidence of liquidation or store closures right now.
You might come across rumors tying the company to Neiman Marcus or other chains, but those merger rumors aren’t backed by any reliable data. As of this writing, there’s just no confirmed deal or active talks.
What Does This Mean for Investors and Shoppers?
If you follow the stock, you’ll see Sportsman’s Warehouse trading like a distressed company shares go for around 6.7 times projected EBITDA. That’s pretty low, but in retail, today’s book value isn’t always a great indicator. Sometimes what matters more is the store footprint, brand recognition, or even email lists.
For everyday shoppers, nothing much has changed just yet. Stores are open, sales are running, and you can still buy online as usual. Some suppliers or brands might keep an extra close eye on the situation in case payments slow down, but shelves are stocked and workers are still there to answer questions about the best spinning rod.
If you’re curious about how other retailers have managed distress or want tips on weathering retail uncertainty, you might check out some resources like Epic Business Tips for real-world stories and practical advice.
How the New CEO Is Steering the Ship
Paul Stone who took the top job after the rough patch in 2023 seems laser-focused on survival, not growth. Ending new store openings is one obvious step. There are reports of stricter inventory controls and a push to wring more cash out of existing stores.
Retailers often live and die by their ability to adapt. For Sportsman’s Warehouse, adapting means keeping cash on hand, moving inventory faster, and finding which markets still love brick-and-mortar gear shops.
If Stone and his team can nudge margins back up, even a little, the pressure eases. If not, and the economic cycle doesn’t break their way, the odds of some kind of restructuring shoot higher.
Wrap-Up: The Outlook for Sportsman’s Warehouse (For Now)
So, is Sportsman’s Warehouse closing down in 2024? Not right now. Is it in real financial trouble? Yes maybe the most trouble it’s faced since the last bankruptcy back in 2008. There’s a real chance it could restructure, shrink, or end up with a new owner before 2026.
But if you’re a customer, you still have time to shop for your next fishing trip, and if you’re a retail industry fan, you’ll want to keep an eye on earnings calls and company news through the next year or two. Survival in retail sometimes means making tough calls and moving quickly, and that’s just what Sportsman’s Warehouse is trying to do.
No need to panic-buy, but if you follow retail, this one’s worth watching as a lesson in what happens when boom times fade, and tough management decisions make all the difference.
Also Read:
