Trade-Ideas: Foot Locker (FL) Is Today's New Lifetime High Stock

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer.

Trade-Ideas LLC identified Foot Locker ( FL) as a new lifetime high candidate. In addition to specific proprietary factors, Trade-Ideas identified Foot Locker as such a stock due to the following factors:

  • FL has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $102.3 million.
  • FL has traded 56,684 shares today.
  • FL is trading at a new lifetime high.

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More details on FL:

Foot Locker, Inc. operates as an athletic shoes and apparel retailer. The company operates in two segments, Athletic Stores and Direct-to-Customers. The stock currently has a dividend yield of 1.5%. FL has a PE ratio of 18. Currently there are 11 analysts that rate Foot Locker a buy, 1 analyst rates it a sell, and 3 rate it a hold.

The average volume for Foot Locker has been 1.8 million shares per day over the past 30 days. Foot Locker has a market cap of $9.2 billion and is part of the consumer goods sector and consumer non-durables industry. The stock has a beta of 1.29 and a short float of 10.4% with 10.16 days to cover. Shares are up 17.2% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Foot Locker as a buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, impressive record of earnings per share growth, increase in net income, revenue growth and largely solid financial position with reasonable debt levels by most measures. We feel its strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the ratings report include:
  • Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 27.51% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, although almost any stock can fall in a broad market decline, FL should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • FOOT LOCKER INC has improved earnings per share by 17.3% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, FOOT LOCKER INC increased its bottom line by earning $3.56 versus $2.85 in the prior year. This year, the market expects an improvement in earnings ($4.02 versus $3.56).
  • The net income growth from the same quarter one year ago has greatly exceeded that of the S&P 500, but is less than that of the Specialty Retail industry average. The net income increased by 13.6% when compared to the same quarter one year prior, going from $162.00 million to $184.00 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 9.2%. Since the same quarter one year prior, revenues slightly increased by 2.6%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • FL's debt-to-equity ratio is very low at 0.05 and is currently below that of the industry average, implying that there has been very successful management of debt levels.

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