I shorted some HIBB after-hours at $12.45. It closed at $15.96 so it was down almost 25% already. Why on earth would I chase it? for a few reasons:

1. They cut their fourth quarter forecast to 20-26c from 36-44c
2. They cut their comp sales forecast from up mid-single digits to down mid-single digits
3. Companies that miss guidance have been getting punished — possibly punished more than they deserve to be, but punished nonetheless. For examples, see how RT, SHOR, SNS, ZLC, TIF, and MW traded after the print.
4. I tried to work out where I think the stock can go and if I get extremely bearish on it, I can cut their earnings for FY 2009 to 64c from de-leveraging effects of weaker sales and softer traffic. So, a 12x multiple on 64c equals a $7.68 stock.

Anyhow, I don’t necessarily think we’ll get there. I just think that the risk/reward is pretty good.