Core Insights - Foot Locker, Inc. is positioned for growth through its Lace Up Plan, effective cost management, and investments in stores and digital capabilities [1][2][4] - The company has shown consistent comparable sales growth, improved gross margins, and strong free cash flow, indicating operational resilience [1][2] Sales Performance - In Q4 of fiscal 2024, comparable sales increased by 2.6% year-over-year, with Foot Locker and Kids Foot Locker brands leading the growth [3] - The company forecasts fiscal 2025 comparable sales growth of 1-2.5%, marking its fourth consecutive year of positive comps [3] Cost Management - Cost-reduction initiatives resulted in $35 million in savings during Q4, exceeding the target of $350 million for fiscal 2024 with $100 million achieved [4] - The gross margin improved by 300 basis points to 29.6% in Q4, driven by a recovery in merchandise margins [5] Future Projections - For fiscal 2025, Foot Locker anticipates gross margin expansion of 40-80 basis points, targeting a range of 29.3-29.7% [6] - Adjusted EPS is expected to be between $1.35 and $1.65, indicating a 10% increase at the midpoint from fiscal 2024 [7] Store and Digital Expansion - The company refreshed over 400 store locations in fiscal 2024 and plans to update an additional 300 stores in 2025, with new "Reimagined" stores projected to generate $4-$5 million in annual sales each [10] - Digital sales penetration grew by 230 basis points year-over-year to 21.8% of total sales, with a goal of reaching 25% by fiscal 2026 [11] Customer Engagement - The relaunch of the FLX Rewards Program significantly boosted customer retention, accounting for 49% of North American sales in Q4, up nearly 30 percentage points from the previous year [12] Valuation and Market Position - Foot Locker's stock is trading at a low price-to-sales multiple of 0.13, below the industry average of 1.30, indicating it may be undervalued [13] - The company faces challenges in international markets, with a 7.6% drop in sales in the Asia-Pacific region in Q4, impacted by inflation and competition [14]

Company Overview - Foot Locker (FL) shares increased by 19% to close at $13.64, following a significant trading volume compared to normal sessions, despite a 29.4% loss over the past four weeks [1] - The company is making progress with its Lace Up Plan, focusing on digital acceleration, store optimization, and brand diversification to enhance comparable sales growth and improve margins [2] Earnings Expectations - Foot Locker is expected to report quarterly earnings of $0.01 per share, reflecting a year-over-year decline of 95.5%, with revenues projected at $1.85 billion, down 1.6% from the previous year [3] - The consensus EPS estimate for Foot Locker has been revised down by 90.2% over the last 30 days, indicating a negative trend in earnings estimate revisions, which typically does not lead to price appreciation [4] Industry Context - Foot Locker is part of the Zacks Retail - Apparel and Shoes industry, where Boot Barn (BOOT) also operates, having closed 12.8% higher at $103.69, but with a -9.5% return over the past month [4] - Boot Barn's consensus EPS estimate remains unchanged at $1.24, representing a year-over-year increase of 22.8% [5]

Core Insights - Brands relying on the Asia-Pacific region for apparel production are seeking ways to mitigate the impact of President Trump's reciprocal tariff plan [1] - The average pre-mitigation headwinds to gross margin and EPS are 670 basis points and 65%, respectively [1] - Companies like Under Armour, VF Corp, and Nike are particularly vulnerable due to their low margin structures [2] Company-Specific Analysis - Under Armour, VF Corp, and Nike have little "cushion" to absorb incremental tariffs, which will significantly impact their EPS [2] - Ralph Lauren and Foot Locker are the least impacted brands, with a predicted 20-25% pre-mitigation headwind to EPS due to their strong international presence and high-margin P&L [2] - Ralph Lauren has a strong track record of raising prices for eight consecutive years, indicating confidence in managing pricing if necessary [3] - Foot Locker has minimal direct exposure to tariffs as they import sneakers, although they face indirect risks from suppliers [3] Manufacturing Insights - The analyst does not expect a shift towards in-sourcing manufacturing to the U.S. due to challenges in building capacity and finding skilled labor [4]

Foot Locker, Inc. (FL) is currently trading at a low price-to-sales (P/S) multiple, which is below the average of the Zacks Retail - Apparel and Shoes industry and Retail-Wholesale sector. With a forward 12-month P/S of 0.17, FL is priced lower than the industry average of 1.39 and the sector average of 1.47. For fiscal 2025, Foot Locker expects gross margin expansion of 40-80 basis points, reaching 29.3-29.7%. This will be supported by stronger full-price selling, lower markdowns, and ongoing savings. Desp ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended February 1, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File No. 1-10299 (Exact name of registrant as specified in its charter) | New York | 13-3513936 | | --- | --- | | (State or other ju ...

Company Overview - Foot Locker, Inc. is a leading footwear and apparel retailer with approximately 2,400 retail stores in 26 countries across North America, Europe, Asia, Australia, and New Zealand [3] - The company has a strong history of sneaker authority and aims to ignite the power of sneaker culture through its portfolio of brands, including Foot Locker, Kids Foot Locker, Champs Sports, WSS, and atmos [3] Upcoming Event - Mary Dillon, CEO, Mike Baughn, CFO, and Frank Bracken, President, will present at the J.P. Morgan 11th Annual Retail Round Up Conference on April 3rd at 8:00 a.m. ET [1] - An audio fireside chat will be available on footlocker-inc.com on the same date and a replay will be accessible for 90 days following the event [2]

Core Insights - Foot Locker, Inc. has appointed Franklin R. Bracken as President, effective immediately, while he continues to report to CEO Mary Dillon [1][2] - Bracken will focus on executing the Lace Up Plan, which aims to enhance the omni-retail experience, improve productivity, and create long-term shareholder value [1][2] - Bracken has nearly 30 years of experience in various sectors including brand management and retail operations, and has been with Foot Locker since 2010 [2] Company Overview - Foot Locker, Inc. operates approximately 2,400 retail stores across 26 countries, including North America, Europe, Asia, Australia, and New Zealand [3] - The company is recognized for its strong sneaker authority and aims to ignite sneaker culture through its portfolio of brands, which includes Foot Locker, Kids Foot Locker, Champs Sports, WSS, and atmos [3]

I wrote about Foot Locker (NYSE: FL ) previously with a hold rating as I was worried about how gross margin would be in 4Q24 given the promotional environment. I stay hold-rated as I expect concerns regardingI am an individual investor that is now fully focus on managing my own capital that I have saved up over the years. My investing background spreads across a wide spectrum as I believe there are merits to each approach, for instance: Fundamental investing [Bottoms-up etc.], Technical investing [historica ...

Group 1 - The investment strategy focuses on long-only investment, evaluating companies from an operational and buy-and-hold perspective, rather than market-driven dynamics [1] - The articles emphasize understanding the long-term earnings power of companies and the competitive dynamics within their industries [1] - The majority of recommendations will be holds, indicating a cautious approach to market conditions and a belief that only a small fraction of companies are suitable for buying at any given time [1] Group 2 - The articles aim to provide important information for future investors and introduce a healthy skepticism towards a generally bullish market [1] - There is a clear distinction made between the author's opinions and professional investment advice, highlighting the need for readers to conduct their own due diligence [2][3]

Financial Data and Key Metrics Changes - The company reported a total sales decline of 5.8% in the fourth quarter, primarily due to the lapping of the fifty-third week in 2023, foreign currency headwinds, and store closures [48] - Total comparable sales increased by 2.6%, marking the third consecutive quarter of positive comps [48] - Gross margin expanded by 300 basis points year over year to 29.6%, driven by lower markdown levels and cost optimization programs [49][50] Business Line Data and Key Metrics Changes - Global Foot Locker and Kids Foot Locker banners led the comp increase with a 3.6% rise, supported by strong holiday sales [7][48] - Champs Sports experienced a 1.8% comp increase, marking the second consecutive quarter of positive comps since its repositioning [7][42] - The footwear category saw high single-digit comp growth, driven by strong launches from brand partners like Jordan and Adidas [31][34] Market Data and Key Metrics Changes - North America overall comps were up 3.6%, with Foot Locker North America banner achieving a 5.5% comp increase [39] - European comps increased by 1.9%, despite a competitive and promotional environment [45] - Asia Pacific comps fell by 7.6%, reflecting competitive dynamics and the winding down of operations in South Korea [46] Company Strategy and Development Direction - The company is focused on executing its Lace Up plan, which includes enhancing customer experience through store refreshes and digital improvements [10][15] - Plans for 2025 include maintaining a disciplined approach to capital investments, prioritizing customer-facing initiatives that drive returns [15][56] - The company aims to optimize its real estate portfolio, having closed over 20% of its global doors since 2019 [21] Management's Comments on Operating Environment and Future Outlook - Management noted increased consumer caution and sensitivity, impacting business performance in early 2025 [14][66] - The outlook for 2025 includes expected ongoing comp sales growth and margin expansion, despite recognizing consumer uncertainties [52][55] - Management expressed confidence in the execution of the Lace Up plan and the potential for profitable market share gains [59] Other Important Information - The company achieved $100 million in savings as part of its cost optimization program in 2024, exceeding prior expectations [13][50] - The FLX Rewards program saw significant adoption, with loyalty penetration reaching 49% of sales in North America [25][26] Q&A Session Summary Question: Can you provide more color on what you're seeing quarter to date regarding consumer behavior? - Management observed that while there was strong momentum coming out of the holiday season, consumer uncertainty began to rise in February, leading to choppy performance [64][66] Question: What are the expectations for NIKE in the near term? - Management indicated that they are closely aligned with NIKE to optimize merchandise mix and inventory levels, anticipating positive outcomes from NIKE's innovation pipeline [76][82] Question: Why aren't there bigger cost savings reflected in SG&A? - Management acknowledged that while progress has been made, the current SG&A rate is not supportive of long-term profit targets, and they will continue to work on lowering it [71][72]