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Here's How Foot Locker (FL) is Placed Ahead of Q3 Earnings
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Foot Locker, Inc. (FL - Free Report) is expected to have registered a year-over-year decline in its top and bottom lines in the third quarter of fiscal 2023. The company is scheduled to report results on Nov 29, before market open. The Zacks Consensus Estimate for quarterly revenues is currently pegged at $1,966 million, indicating a 9.5% fall from the prior-year fiscal’s quarterly reported figure.
The consensus estimate for quarterly earnings is currently pegged at 23 cents per share, suggesting a significant decrease from earnings of $1.27 per share reported in the year-earlier quarter. The consensus mark has declined 11.5% over the past 30 days.
This athletic shoes and apparel retailer delivered an earnings surprise of 18.2%, on average, in the trailing four quarters.
Key Factors to Note
Foot Locker’s quarterly performance is likely to have been hurt by a challenging macroeconomic landscape, including inflationary pressures affecting customers’ spending and currency headwinds. In fact, a slowdown in consumer spending is expected to have hurt FL’s top-line performance.
Our estimates for fiscal third-quarter sales for the company’s North America and International segments (comprising EMEA and Asia Pacific) are pegged at $1,364.7 million and $603.9 million, respectively, suggesting year-over-year declines of 9% and 10.3%, respectively.
Although Foot Locker’s expansionary efforts into new markets bode well for its long-term growth, it might have affected its margins and profitability. Also, increased markdowns on higher promotional activity, occupancy deleverage and significant investments to reinforce its digital presence might weigh on the results. We expect a gross margin of 27.7% in the quarter, reflecting a year-over-year decline of 430 basis points.
Given the company’s substantial international operations, foreign-currency woes might have hurt its top line in the third quarter.
Nevertheless, management has been trying to improve performance through operational and financial initiatives. The company is progressing well with its FLX membership program and strategic deals, including partnerships and acquisitions. Also, its cost management actions are likely to have aided its margins amid the inflationary pressure.
Our proven model doesn’t conclusively predict an earnings beat for Foot Locker this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.
Foot Locker has an Earnings ESP of -17.37%. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.
FL carries a Zacks Rank #5 (Strong Sell).
Stocks With the Favorable Combination
Here are a few companies, which according to our model, have the right combination to beat on earnings this reporting cycle:
GPS’ earnings for the to-be-reported quarter are expected to increase 124%. The consensus mark for its quarterly earnings has moved up by 12.5% to 18 cents per share in the past 30 days.
The Zacks Consensus Estimate for Gap’s quarterly revenues is pegged at $4.2 billion, which suggests a fall of 0.2% from the figure reported in the prior-year quarter.
American Eagle (AEO - Free Report) has an Earnings ESP of +5.93% and currently carries a Zacks Rank #2. The company is likely to register growth in the top and bottom lines when it reports fourth-quarter fiscal 2023 numbers. The consensus mark for AEO’s quarterly earnings has moved up by a penny to 43 cents per share in the past 30 days. The consensus estimate suggests 16.2% growth from the year-ago quarter’s reported number.
The Zacks Consensus Estimate for American Eagle’s quarterly revenues is pegged at $1.55 billion, suggesting growth of 3.7% from the figure reported in the prior-year quarter.
Abercrombie & Fitch Co. (ANF - Free Report) has an Earnings ESP of +0.62% and carries a Zacks Rank #2. ANF’s earnings for the to-be-reported quarter are expected to increase by 132.1% on a year-over-year basis. The consensus mark for its quarterly earnings has moved up by 4.4% to $1.88 per share in the past 30 days.
The Zacks Consensus Estimate for Abercrombie & Fitch’s quarterly revenues is pegged at $1.33 billion, which suggests growth of 11.1% from the figure reported in the prior-year quarter.
Image: Bigstock
Here's How Foot Locker (FL) is Placed Ahead of Q3 Earnings
Foot Locker, Inc. (FL - Free Report) is expected to have registered a year-over-year decline in its top and bottom lines in the third quarter of fiscal 2023. The company is scheduled to report results on Nov 29, before market open. The Zacks Consensus Estimate for quarterly revenues is currently pegged at $1,966 million, indicating a 9.5% fall from the prior-year fiscal’s quarterly reported figure.
The consensus estimate for quarterly earnings is currently pegged at 23 cents per share, suggesting a significant decrease from earnings of $1.27 per share reported in the year-earlier quarter. The consensus mark has declined 11.5% over the past 30 days.
This athletic shoes and apparel retailer delivered an earnings surprise of 18.2%, on average, in the trailing four quarters.
Key Factors to Note
Foot Locker’s quarterly performance is likely to have been hurt by a challenging macroeconomic landscape, including inflationary pressures affecting customers’ spending and currency headwinds. In fact, a slowdown in consumer spending is expected to have hurt FL’s top-line performance.
Our estimates for fiscal third-quarter sales for the company’s North America and International segments (comprising EMEA and Asia Pacific) are pegged at $1,364.7 million and $603.9 million, respectively, suggesting year-over-year declines of 9% and 10.3%, respectively.
Although Foot Locker’s expansionary efforts into new markets bode well for its long-term growth, it might have affected its margins and profitability. Also, increased markdowns on higher promotional activity, occupancy deleverage and significant investments to reinforce its digital presence might weigh on the results. We expect a gross margin of 27.7% in the quarter, reflecting a year-over-year decline of 430 basis points.
Given the company’s substantial international operations, foreign-currency woes might have hurt its top line in the third quarter.
Nevertheless, management has been trying to improve performance through operational and financial initiatives. The company is progressing well with its FLX membership program and strategic deals, including partnerships and acquisitions. Also, its cost management actions are likely to have aided its margins amid the inflationary pressure.
Foot Locker, Inc. Price and EPS Surprise
Foot Locker, Inc. price-eps-surprise | Foot Locker, Inc. Quote
What the Zacks Model Unveils
Our proven model doesn’t conclusively predict an earnings beat for Foot Locker this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.
Foot Locker has an Earnings ESP of -17.37%. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.
FL carries a Zacks Rank #5 (Strong Sell).
Stocks With the Favorable Combination
Here are a few companies, which according to our model, have the right combination to beat on earnings this reporting cycle:
The Gap, Inc. (GPS - Free Report) has an Earnings ESP of +12.98% and sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
GPS’ earnings for the to-be-reported quarter are expected to increase 124%. The consensus mark for its quarterly earnings has moved up by 12.5% to 18 cents per share in the past 30 days.
The Zacks Consensus Estimate for Gap’s quarterly revenues is pegged at $4.2 billion, which suggests a fall of 0.2% from the figure reported in the prior-year quarter.
American Eagle (AEO - Free Report) has an Earnings ESP of +5.93% and currently carries a Zacks Rank #2. The company is likely to register growth in the top and bottom lines when it reports fourth-quarter fiscal 2023 numbers. The consensus mark for AEO’s quarterly earnings has moved up by a penny to 43 cents per share in the past 30 days. The consensus estimate suggests 16.2% growth from the year-ago quarter’s reported number.
The Zacks Consensus Estimate for American Eagle’s quarterly revenues is pegged at $1.55 billion, suggesting growth of 3.7% from the figure reported in the prior-year quarter.
Abercrombie & Fitch Co. (ANF - Free Report) has an Earnings ESP of +0.62% and carries a Zacks Rank #2. ANF’s earnings for the to-be-reported quarter are expected to increase by 132.1% on a year-over-year basis. The consensus mark for its quarterly earnings has moved up by 4.4% to $1.88 per share in the past 30 days.
The Zacks Consensus Estimate for Abercrombie & Fitch’s quarterly revenues is pegged at $1.33 billion, which suggests growth of 11.1% from the figure reported in the prior-year quarter.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.