Brean Capital Reiterates Buy on Finish Line (FINL) Following 2Q Report

September 26, 2016 10:14 AM EDT
Get Alerts FINL Hot Sheet
Price: $24.24 -0.49%

Rating Summary:
    14 Buy, 17 Hold, 0 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 21 | Down: 36 | New: 11
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Brean Capital reiterated a Buy rating and $24.00 price target on Finish Line (NASDAQ: FINL) following the company's 2Q earnings report. FINL's 2Q print came relatively in line, with adjusted EPS of $0.53 a penny below consensus, as better-than-expected comp growth of +5.1% (vs. consensus' +3.9%) was mostly offset by softer-than-expected gross margin, which was down nearly -170 bps.

Analyst Eric Tracy commented, "We are maintaining our constructive stance on shares of FINL following 2Q's relatively in-line print (EPS of $0.53 slightly below our $0.55 estimate, with better comp performance and solid expense management mostly offset by weaker-than-expected GM), and believe FINL can deliver in 2H given 1) improving vendor allocations, and 2) material rev/ margin re-capture opportunity following last year's supply chain snafu. Layering in manifesting benefits from an improved operating model (cost structure optimization, rationalization of B&M footprint, and remodels), we think shares can continue to grind higher, even as we acknowledge risk/reward has been somewhat neutralized (even following Friday's -5% intraday pullback) by shares +25% from our 12/23 upgrade. Accordingly, we are tweaking our estimates slightly (now modeling FY18 EPS of $1.77 vs. prior $1.76), with our unchanged $24 TP still based on shares trading 14x our FY18 EPS estimate."

For an analyst ratings summary and ratings history on Finish Line click here. For more ratings news on Finish Line click here.

Shares of Finish Line closed at $22.75 yesterday.



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