Finish Line (FINL) PT Lowered to $14 at Canaccord Genuity Following Weak 4Q
Canaccord Genuity lowered its price target on Finish Line (NASDAQ: FINL) to $14.00 (from $18.00) while maintaining a Hold rating. 4Q EPS of 50c fell significantly short of the consensus of 70c.
Analyst Camilo Lyon commented, "FINL reported a disappointing Q4 with adj. EPS of 50c falling significantly short of our 69c estimate and consensus of 70c. The miss was largely driven by a 500bps decline in gross margin (-16c impact) as the comp decline of 4.5% was slightly below our 4% estimate. In response to a broad slowdown in footwear (-1.6%), negative traffic from the tax refund delays, ongoing weakness in soft goods (-27%), and a more aggressive promotional environment, the company aggressively marked down slow-moving product, resulting in 450bps product margin decline vs. plan of 150-200bps contraction. As a result of the markdowns, FINL exited Q4 with clean inventory (-4.8% vs. -0.4% sales) and is better positioned to flow new product."