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UPDATE 1-UBS cuts Big 5 Sporting to sell; shares down

Wed Sep 17, 2008 10:59am EDT

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Sept 17 (Reuters) - UBS downgraded Big 5 Sporting Goods Corp (BGFV.O) to "sell" from "neutral," saying a recent rise in the sporting goods retailer's stock price was inconsistent with a deteriorating fundamental outlook for the company.

Big 5 Sporting shares, which gained nearly 68 percent through Tuesday after hitting a 52-week low of $6.50 in July, fell as much as 14 percent in morning trade Wednesday on Nasdaq.

"The consumer environment in California continues to weaken and competitive pressures for Big 5 Sporting should intensify significantly as Dick's Sporting Goods Inc (DKS.N) expands further into the western United States," UBS wrote in a note.

The brokerage said it remained concerned with prospects for Big 5 Sporting over the next several quarters. The company retails sporting goods, including athletic shoes, apparel and outdoor equipment for camping, hunting and snowboarding.

UBS has a price target of $8 on the shares of the El Segundo, California-based company.

Big 5 Sporting shares, which fell to a low of $9.40 earlier, pared some loss and were trading down 90 cents at $10.01. (Reporting by Dilipp S. Nag in Bangalore; Editing by Himani Sarkar)

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