Put Traders Run Up Foot Locker Stock Before Earnings

Put traders are betting on a lower post-earnings move

Deputy Editor
May 18, 2023 at 1:56 PM
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The shares of Foot Locker, Inc. (NYSE:FL) are up 1.1% at $42.01 at last glance, as retailer gets ready to report second-quarter earnings before the open tomorrow, May 19. Ahead of the event, put traders are placing their bets.

At last check, over 3,500 bearish bets across the tape so far today, volume that's five times the average intraday amount. Most popular is the January 2024 30-strike put, followed by the May 37 put.

A look at the FL's history of post-earnings reactions over the past two years shows a mostly positive responses, though there was a 5.7% slide after the March report. The stock averages a post-earnings swing of 11.2% the last eight quarters, regardless of direction. This time around, the options market is pricing in a similar move of 12.8%. 

Analysts aren't optimistic toward Foot Locker stock either. Of the 16 in coverage, just five sport a "strong buy" versus 11 tepid "hold" ratings. Meanwhile, the 9.59 million shares sold short account for 10.5% of FL's total available float. A post-earnings pop could force upgrades to FL while catching those shorts off guard. 

Foot Locker stock has had a fairly volatile year, hitting an annual high of $47.22 on Feb. 3, before pulling back to its 160-day moving average on multiple occasions, including last week. Still, FL stands just over 11% higher in 2023, with a 36% year-over-year lead to boot.

FL Chart



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