Keybanc initiated coverage with a "sector weight" rating
The shares of Foot Locker Inc (NYSE:FL) are down 0.8% at $41.90 at last check, after KeyBanc initiated coverage with a "sector weight" rating. The firm believes the shoe retailer is making the right investments in regard to e-commerce, international, and product, but notes the tough competition as things start to return to normal after the pandemic. Meanwhile, Berenberg today raised its price target to $54 from $52.
After bouncing off the 60-day moving average, a trendline of support since August, FL's recent climb culminated in a Dec. 9 annual high of $43.07. Though it has taken a breather since then, the equity remains an impressive 140% above its March lows.
There is plenty of room for more upgrades amongst the brokerage bunch, with 10 of the 19 analysts in coverage sporting a "hold" or worse rating. An unwinding of short interest could act as a tailwind as well, as the 6.32 million shares sold short still make up 7% of FL's available float, and would take nearly three days to cover at the stock's average pace of trading.
Lastly, now looks like a good time to weigh in on Foot Locker options. The stock's Schaeffer's Volatility Index (SVI) of 45% stands higher than 15% of all other readings in its annual range, implying that options players are pricing in relatively low volatility expectations at the moment.