We are taking a bath on Foot Locker. Foot Locker (NYSE:FL) has just reported earnings and shares are getting killed. And truly this is one of the most disgusting moments in the company’s history. Honestly, how do you not preannounce something to soften the blow here? We digress. This was a highly anticipated report.
Just look at what has happened in the last year. Remember when we told you last spring that there was a rare opportunity in the stock of this spring? Had you purchased then, you would have seen a 45% gain if you sold at the top. Then, shares started cratering as all of retail has been decimated in the last 6 months.
It has really been ridiculous the sentiment. All footwear and sporting goods related stocks have perhaps been hit the absolute hardest. And it is only getting worse with this report.
This news comes not just from Amazon seeing record revenues, but news that Nike (NKE) would sell on Amazon. In addition, second quarter earnings were a travesty, and as such we are taking a major bath on shares. Still, we remain bullish, and think the stock is a strong buy under $40.