Telsey Reiterates Market Perform Rating on Foot Locker (FL)

Telsey analyst Cristina Fernandez reiterated a Market Perform rating and $27.00 price target on Foot Locker (NYSE: FL).

The analyst comments "TAG: Foot Locker's shares are up 26% since the 1Q24 report on May 30 and embed the company returning to a positive comp in 2Q24 and seeing an acceleration in 2H24. We see Foot Locker benefiting from a diversified portfolio of brands with several experiencing strong demand like adidas Originals, Asics, Hoka, New Balance, and On as well as the relaunch of its FLX program in the US in June. However, our enthusiasm is tempered by retailers' commentary around a more cautious consumer as 2Q24 progressed. On the profit line, 2Q24 should begin to see the benefit from lower promotions YoY, offset by the one-time impact of the FLX transition and ongoing investments to improve the consumer experience in store and online and modernize the brand. We expect Foot Locker to maintain its full year EPS guidance. We maintain our Market Perform rating and 12-month price target of $27, based on applying a P/E multiple of 11x (in line with the stock's FY2 10-year average) to our 2025 EPS estimate of $2.45. On the call, we will look for color around: 1) demand trends through the quarter as well as by brand, concept, and product category; 2) early read from the FLX program relaunch in the US including sign-ups and conversion; 3) performance of new and remodeled stores; and 4) progress with the Champs banner transformation."

For an analyst ratings summary and ratings history on Foot Locker click here. For more ratings news on Foot Locker click here.

Shares of Foot Locker closed at $32.61 yesterday.

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