Tomahawk, WI 03/10/2014 (Basicsmedia) – Following a better than expected quarterly earnings for Q4 2013 the multichannel footwear and accessories retailer FootLocker Inc (NASDAQ:FL) closed in green, yesterday. The stock surged to highest ever price point of $46.49 marking an 8.8% increase over last days’ closing rate; a growth of $12 over the last highest point of $34.5 which it touched over 2 decades ago in Sep,1985.
Fundamental Indicators that Support FootLocker’s Stock Surge
Analysts are attributing this stock screener success to FootLocker Inc (NASDAQ:FL)’s improving fundamental indicators like sales growth, sales productivity and margins; all three being supported by increased demand for recognized brands like Nike and Adidas. A few of strong business indicators are enlisted below;
- In its recently reported Q4, 2013, financial data the company’s booked a 5.3% increase in same store sales against an industry average of 0.4%, a 6.24% increase in per sq. ft sales and 0.5 percentage point improvement in annualized margins.
- The uptrend in FootLocker Inc (NASDAQ:FL)’s same store sales speaks of a consumer-optimized Bricks-and-Mortar (BAM) existence. Its same store sales were up 5.3% sequentially and 4.2% year on year.
- There is a visible cost cutting advantage, which the company has leveraged on in the later part of the FY 2013. On a closer look, quarterly and annual revenues grew 4.6% and 5.2% respectively while EPS was up by 28% and 16% respectively.
FootLocker’s Competitive Edge
Owing to the omnipresence of online ecommerce and growing consumer awareness, most BAM specialty retailers today are reconsidering their business models. While BMAs like RadioShack Corporation (NYSE:RSH) having a storefronts inventory comparable to Footlockers’ (over 5000 stores) (having 52,00 atleast) steadily embark upon store-count, redesign and cost cuts others like SafeWay Inc (NYSE:SWY) are selling out.
Going forward!! FootLocker Inc (NASDAQ:FL)’s existing brand inventory will help it grow in the coming FIFA season. Beyond that point the business will only find support from macro-trends like growing health consciousness among mass public in developed and developing nations. The footwear giant has been earning good return on its capital assets (stores), however it is high time to widen its brand portfolio to grab larger share of consumer Wallet and develop sales from non-seasonal products.