Checking in on Foot Locker Stock Before Earnings

The stock has a history of outsized post-earnings swings

Deputy Editor
Mar 5, 2024 at 3:14 PM
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Foot Locker Inc (NYSE:FL) will report earnings before the open tomorrow, Mar. 6. Ahead of the event, FL is up 1.5% at $34.41, with recent pressure at the $35 mark keeping a cap on gains. The stock has a tendency to make large post-earnings swings though, so depending on which direction it goes after tomorrow's results, it could make a break past that level. 

FL March5

Foot Locker stock experienced a 16.1% move higher after the retailer's November report, and has since continued to rise, up 10.7% since the start of the year. This time around, the options pits are pricing in a next-day move of 25.9%, regardless of direction, which is larger than the 17.5% move the stock has averaged over the past two years. 

There's plenty of pessimism from traders and analysts that could lead to tailwinds should FL post positive results. Short interest represents 13.6% of the stock's available float, while 14 of the 17 analysts covering FL rate it a "hold" or worse. 

Options traders have been chiming in ahead of the event, as FL has already seen 5 times its average daily options volume. So far, 14,000 calls and 16,000 puts have been exchanged, with the most activity at the March 33.50 put. New positions are being opened at the second-most popular position, the weekly 3/8 41-strike call. 

 

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