FBR Capital Maintains an 'Outperform/Top Pick' on Foot Locker (FL); Management Meeting Takeaways

FBR Capital maintains an 'Outperform/Top Pick' on Foot Locker (NYSE: FL), raises PT to $28.

FBR analyst says, "Summary takeaways from meetings with management. Key points of discussion in our meetings focused on (1) merchandising/health of the product cycle in footwear, (2) long-term plan/goals in light of recent performance, (3) structural levers that could support above-peak margin trajectory, (4) accretive growth vehicles (international, new concepts, e-commerce), (5) strategic investments (systems, training, infrastructure), (6) potential headwinds -inflationary pressures, NBA/NFL lockout, and (7) deployment of cash."

"Our FY11 EPS estimate remains intact at $1.54, and assumes a +6% comp and operating margin of 7.2%, implying +40% YOY earnings growth. Our 2Q EPS estimate of $0.12 (versus $0.04 last year) assumes a +6% comp, below current quarter-to-date trends. Our FY12 EPS estimate is also intact at $1.77 (+15% YOY)."

For more ratings news on Foot Locker click here and for the rating history of Foot Locker click here.

Shares of Foot Locker closed at $23.87 yesterday.

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