Foot Locker falls as Morgan Stanley turns bearish
** Shares of Foot Locker FL.N down 4.1% at $25.37 in early Thurs trade after Morgan Stanley downgrades specialty athletic apparel retailer to "underweight" from "equal-weight"
** Brokerage chops PT by $6 to $18, implying 32% downside to stock's last close
** Citing "tough" 2H set-up - including more difficult compares, 53rd-week reversal, election overhang and unfavorable holiday calendar - Morgan Stanley says it's cautious on softlines retail space
** FL screens as having among greatest 2H24 estimated EPS risk in coverage universe, Morgan Stanley says, pointing to expensive valuation vs historical multiples and mall-based peers
** Other reasons for bearish stance include uncertain P&L impact of the Nike NKE.N reset and limited promotion recapture conviction, brokerage says
** On Tues, FL shares rose nearly 9%, getting a boost after German sportswear maker Adidas ADSGn.DE hiked its 2024 profit guidance
** On May 30, FL shares finished up 15% after co posted qtrly EPS beat as inventories decreased 5.6% yr/yr
** Avg rating among 19 analysts covering FL is "hold" and breakdown of recommendations is 1 "strong buy", 1 "buy", 12 "hold", 4 "sell" and 1 "strong sell" with median PT of $26.50 - LSEG
** With move on the session, shares down 18% YTD
(Lance Tupper is a Reuters market analyst. The views expressed are his own)
</body></html>Related Assets
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
