Shares of athletic footwear and apparel retailer Foot Locker (NYSE: FL – $75.10) rallied nearly 10% today after reporting fourth quarter results that beat Street estimates. The company said profits rose to $189 million from $158 million, in the same period a year ago, and adjusted earnings per share was $1.37 vs. $1.16 last year and above the consensus of $1.32. Revenue increased to $2.11 billion from $2.01 billion, matching the consensus. Same-store sales increased 5.0%, beating the estimates of 4.5% growth and total world-wide sales were higher by 5.3%. Foot Locker is planning for a mid-single digit comparable sales gain and a double-digit earnings per share increase for full year of 2017. Analysts have 2017 earnings per share pegged at $5.28 vs. this past year’s $4.82.
The growing popularity of casual footwear ought to remain a boon to sales over the near term and longer-term, the shares should continue to press higher. I still believe the stock is reasonably valued and can continue to be held in an aggressive account for now.