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Foot Locker (FL) Queues Up for Q4 Earnings: What to Expect?
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We expect Foot Locker, Inc. (FL - Free Report) to report a year-over-year decline in its bottom line when it releases fourth-quarter fiscal 2020 results on Feb 26. Incidentally, the Zacks Consensus Estimate for the quarter’s earnings is currently pegged at $1.33, which suggests a decrease of more than 18% from $1.63 earned a year ago. However, the consensus mark moved 3 cents north over the past 30 days.
A glance at the athletic shoes and apparel retailer’s performance over the trailing four quarters shows that it has a negative earnings surprise of 46.6%, on average.
Further, the consensus estimate for quarterly revenues stands at $2,282 million, indicating an improvement of about 3% from the year-ago quarter’s tally.
Key Factors to Note
Although Foot Locker has been taking initiatives to maneuver the pandemic-induced challenges, concerns related to the pandemic persist. The company’s business has taken a hit in Europe, thanks to widespread pandemic restrictions. In addition, Foot Locker’s accessories business has been under pressure owing to sluggishness in sales of bags, shoe care and hard goods.
We note that lower merchandise margin rate has been affecting Foot Locker’s gross margin for a while now. Nonetheless, management forecast less promotional pressure on merchandise margins for the fiscal fourth quarter. However, it informed that fewer returns to vendors could result in higher-than-normal markdown rates. Also, higher freight cost is an added headwind. The impact of incremental expense related to personal protective equipment cannot be ruled out as well.
Nonetheless, Foot Locker is constantly trying to drive performance through operational and financial initiatives. The company has been investing in digital platforms, improving supply chain efficiencies and effectively managing inventory. The New York-based company has been augmenting its e-commerce platform and expanding direct-to-consumer operations. It is also benefiting from its partnerships. We note that the company’s basketball footwear category is experiencing a strong momentum. These factors coupled with brand strength are likely to have boosted Foot Locker’s top line in the quarter to be reported.
What the Zacks Model Unveils
Our proven model predicts an earnings beat for Foot Locker this reporting cycle. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Foot Locker sports a Zacks Rank #1 and an Earnings ESP of +2.69%.
More Stocks With Favorable Combinations
Here are a few more companies worth considering from the same sector as our model shows that these too have the right combination of elements to beat on earnings:
Dollar General (DG - Free Report) presently has an Earnings ESP of +1.11% and a Zacks Rank #3.
Lowe's (LOW - Free Report) has an Earnings ESP of +5.29% and a Zacks Rank #3.
Breakout Biotech Stocks with Triple-Digit Profit Potential
The biotech sector is projected to surge beyond $775 billion by 2024 as scientists develop treatments for thousands of diseases. They’re also finding ways to edit the human genome to literally erase our vulnerability to these diseases.
Zacks has just released Century of Biology: 7 Biotech Stocks to Buy Right Now to help investors profit from 7 stocks poised for outperformance. Our recent biotech recommendations have produced gains of +50%, +83% and +164% in as little as 2 months. The stocks in this report could perform even better.
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Foot Locker (FL) Queues Up for Q4 Earnings: What to Expect?
We expect Foot Locker, Inc. (FL - Free Report) to report a year-over-year decline in its bottom line when it releases fourth-quarter fiscal 2020 results on Feb 26. Incidentally, the Zacks Consensus Estimate for the quarter’s earnings is currently pegged at $1.33, which suggests a decrease of more than 18% from $1.63 earned a year ago. However, the consensus mark moved 3 cents north over the past 30 days.
A glance at the athletic shoes and apparel retailer’s performance over the trailing four quarters shows that it has a negative earnings surprise of 46.6%, on average.
Further, the consensus estimate for quarterly revenues stands at $2,282 million, indicating an improvement of about 3% from the year-ago quarter’s tally.
Key Factors to Note
Although Foot Locker has been taking initiatives to maneuver the pandemic-induced challenges, concerns related to the pandemic persist. The company’s business has taken a hit in Europe, thanks to widespread pandemic restrictions. In addition, Foot Locker’s accessories business has been under pressure owing to sluggishness in sales of bags, shoe care and hard goods.
We note that lower merchandise margin rate has been affecting Foot Locker’s gross margin for a while now. Nonetheless, management forecast less promotional pressure on merchandise margins for the fiscal fourth quarter. However, it informed that fewer returns to vendors could result in higher-than-normal markdown rates. Also, higher freight cost is an added headwind. The impact of incremental expense related to personal protective equipment cannot be ruled out as well.
Nonetheless, Foot Locker is constantly trying to drive performance through operational and financial initiatives. The company has been investing in digital platforms, improving supply chain efficiencies and effectively managing inventory. The New York-based company has been augmenting its e-commerce platform and expanding direct-to-consumer operations. It is also benefiting from its partnerships. We note that the company’s basketball footwear category is experiencing a strong momentum. These factors coupled with brand strength are likely to have boosted Foot Locker’s top line in the quarter to be reported.
What the Zacks Model Unveils
Our proven model predicts an earnings beat for Foot Locker this reporting cycle. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Foot Locker, Inc. Price and EPS Surprise
Foot Locker, Inc. price-eps-surprise | Foot Locker, Inc. Quote
Foot Locker sports a Zacks Rank #1 and an Earnings ESP of +2.69%.
More Stocks With Favorable Combinations
Here are a few more companies worth considering from the same sector as our model shows that these too have the right combination of elements to beat on earnings:
Target (TGT - Free Report) has an Earnings ESP of +9.79% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Dollar General (DG - Free Report) presently has an Earnings ESP of +1.11% and a Zacks Rank #3.
Lowe's (LOW - Free Report) has an Earnings ESP of +5.29% and a Zacks Rank #3.
Breakout Biotech Stocks with Triple-Digit Profit Potential
The biotech sector is projected to surge beyond $775 billion by 2024 as scientists develop treatments for thousands of diseases. They’re also finding ways to edit the human genome to literally erase our vulnerability to these diseases.
Zacks has just released Century of Biology: 7 Biotech Stocks to Buy Right Now to help investors profit from 7 stocks poised for outperformance. Our recent biotech recommendations have produced gains of +50%, +83% and +164% in as little as 2 months. The stocks in this report could perform even better.
See these 7 breakthrough stocks now>>