Shares of Foot Locker, Inc. FL climbed on Friday, after the company reported better-than-expected earnings for the second quarter and announced that former CEO of Ulta Beauty Inc ULTA Mary N. Dillon will replace its current CEO, effective September 1, 2022.
Guggenheim Securities On Foot Locker
Analyst Robert Drbul reiterated a Buy rating, while raising the price target from $36 to $43.
“Foot Locker reported 2Q22 adjusted EPS of $1.10, significantly above our estimate of $0.65,” Drbul said in a note.
“We are excited for the future of Foot Locker as we believe the new CEO Ms. Dillon brings extensive retail industry expertise and has everything it takes to continue to push the company forward, executing Foot Locker’s priorities and strategy,” he wrote.
Check out other analyst stock ratings.
Telsey Advisory Group On Foot Locker
Analyst Cristina Fernández maintained a Market Perform rating, while raising the price target from $31 to $42.
The appointment of Dillon as Foot Locker’s next CEO “trumped a softer 2H22 outlook,” Fernández said in a note.
“The CEO change was unexpected, but the timing makes sense given outgoing CEO’s Dick Johnson‘s long tenure and Foot Locker’s need to accelerate its pivot off mall, diversify its brand mix, and reassert its importance in sneaker culture, which has been shifting toward brands, boutiques, and resellers,” he added.
“Mary Dillon is a highly-regarded CEO, with a track record of driving shareholder value (ULTA rose from $99 to $343 during July 2013-May 2021), and experience across industries,” the analyst further mentioned.
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BofA Securities On Foot Locker
Analyst Lorraine Hutchinson maintained a Neutral rating and a price target of $43.
Although Foot Locker reported its quarterly results ahead of expectations, “the most impactful news of the quarter was announcement of Mary Dillon, former Ulta CEO, taking over as CEO,” Hutchinson said.
“We think this is a very encouraging hire given her strong resume, but Dillon is entering a challenging situation,” as Foot Locker aims at transforming into a more diversified franchise with a decline in allocation of Nike Inc NKE.
FL Price Action: Shares of Foot Locker were down by 1.88% to $37.68 at the time of publication Monday.
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