Foot Locker's Issues Are 'Self-Inflicted': 3 Analysts Review Q1 Print

Shares of Foot Locker Inc FL tanked in early trading on Monday, after reporting disappointing earnings for the first quarter.

The report came amid an exciting earnings season.

Here are some key analyst takeaways from the earnings release.

Telsey Advisory Group On Foot Locker

Analyst Cristina Fernández reiterated an Outperform rating while reducing the price target from $50 to $36.

“We were surprised and disappointed by the magnitude of Foot Locker's 2023 guidance cut just two months after its investor day,” Fernández wrote in a note.

“As such, the management team lost some credibility, which we expect will take a few quarters to regain,” the analyst said. She added that the steep cut to the 2023 guidance, which shows a decline of around 60% in Foot Locker’s earnings per share, has “de-risked earnings from here.”

Check out other analyst stock ratings.

Morgan Stanley On Foot Locker

Analyst Alex Straton maintained an Equal-Weight rating while reducing the price target from $33 to $30.

Foot Locker’s first-quarter miss was “nearly across-the-board,” Straton said. He added that the drivers “appear more macro than idiosyncratic.”

“FL’s guidance cut seems to contemplate macro challenges & sets a low enough bar for now,” the analyst further stated.

Oppenheimer On Foot Locker

Analyst Brian Nagel said in a note that although macro conditions are now more challenging, Foot Lock’s recent sales and profit issues “appear largely company-specific, and self-inflicted.”

The company’s sales and margin trends “have worsened lately, upon a number of factors, including: incremental economic pressures on core, lower-income consumers, effects of a significant merchandise reset with Nike Inc NKE, and disruptions related to shutterings and re-positionings within the FL collection of brands,” he added.

FL Price Action: Shares of Foot Locker had declined by 7.58% to $27.92 at the time of publication Monday.

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