Why Foot Locker Is Wednesday's Big Earnings Winner

Chris Lange

FootLocker, Inc. (NYSE: FL) reported fiscal third quarter financial results after markets closed Tuesday. The company posted $0.95 in earnings per share (EPS) and $1.86 billion in revenue, compared with consensus estimates that called for $0.92 in EPS and $1.85 billion in revenue. The same period from last year had $0.87 in EPS and $1.87 billion in revenue.

Third-quarter comparable store sales increased 2.9%, although total sales actually decreased by 0.5%. In constant currency, total sales increased by only 0.4%.

During the third quarter, the Company opened 10 new stores, remodeled or relocated 13 stores, and closed 20 stores.  As of November 3, 2018, the Company operated 3,266 stores.

On the books, cash and cash equivalents totaled $748 million at the end of the quarter, versus $890 million in the same period from last year.

The company did not issue guidance in the report; however, consensus estimates are calling for $1.35 in EPS and $2.14 billion in revenue for the fiscal fourth quarter.

Richard Johnson, Chairman and CEO, commented:

Our accelerating comparable sales and improving bottom line reflect the strategic partnerships with our vendors, as well as our efforts to inspire and empower youth culture and create deeper connections with local communities. We believe we are well positioned to produce even stronger results in the all-important holiday selling season and the fourth quarter overall.

Shares of Foot Locker closed Tuesday at $46.09, with a consensus analyst price target of $56.76 and a 52-week range of $38.17 to $59.40. Following the announcement, the stock was up about 15% at $52.90 in early trading indications Wednesday.