Foot Locker Stock Eyes Six-Month Highs After Earnings

The stock is set to open at its highest level since February

Deputy Editor
Aug 19, 2022 at 9:03 AM
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Foot Locker, Inc (NYSE:FL) stock is surging ahead of the open, 21% in electronic trading, after the athletic apparel and shoe retailer's trip to the earnings confessional. The company reported second-quarter earnings that topped analysts' expectations, as well as a smaller-than-expected drop in same-store sales. In addition, Foot Locker announced a CEO transition, with Ulta Beauty (ULTA) top boss Mary Dillon replacing CEO Richard Johnson on Sept. 1.

Analysts have yet to chime in, but the majority were pessimistic on FL coming into today. in fact, of the 15 in coverage, just one recommended a "strong buy," while the rest said "hold" or worse. The 12-month consensus target price of $31.11, meanwhile, is a 19.8% discount to last night's close.

Options traders are firmly in the bearish camp as well. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), Foot Locker stock sports a 10-day put/call volume ratio of 2.61 that sits higher than 96% of readings from the past year, implying an unusually healthy appetite for bearish bets over the last two weeks.

On the charts, FL is set to open at its highest level since late February, should this premarket results hold. The $34 area has weighed on the equity for much of the year, but today's price action has the shares on track to topple that resistance, as well as the 200-day moving average. Foot Locker stock is also set to take a big chunk out of its 40.5% year-over-year deficit.

 

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