Foot Locker Added To 'Best Ideas' List At Wedbush

Foot Locker Inc (NYSE: FL) sentiment continues to strengthen after the stock was named a "best idea" by Wedbush.  

The Analyst 

Analyst Chris Svezia maintains an Outperform rating and $59 price target on Foot Locker. 

The Thesis

Foot Locker’s stock was negatively impacted by an intense promotional environment prompted by poor trends in basketball, declining sales of legacy franchises and insufficient allocations of popular Nike styles in the second half of 2017, Svezia said in a note. (See the analyst's track record here.) 

While the promotional environment persists into 2018, “comp sales have been better than feared, albeit negative, and we argue that the outlook for Nike is more favorable in terms of product and allocation for the year ahead, which should drive improvement at Foot Locker,” the analyst said. 

Nike is set to release its highly anticipated Epic React Flyknit shoe Feb. 22. 

With Foot Locker purchasing over 60 percent of its merchandise from Nike Inc (NYSE: NKE), the athleticwear company’s improving stature will be followed closely by Foot Locker investors when it reports results in mid-March. Foot Locker is set to report its fourth-quarter earnings March 2.

Price Action

Foot Locker shares were down 2.85 percent at $47 Monday afternoon. 

Related Links:

Foot Locker Scores Another Upgrade As New Basketball Releases Resonate

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