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On Thursday, Williams Trading analyst Sam Poser increased the price target on Foot Locker (NYSE:FL) shares to $24.00, up from the previous target of $11.00, while maintaining a Hold rating. The adjustment follows the announcement of Foot Locker’s first quarter results for 2025 and the pending acquisition by Dick’s Sporting Goods (NYSE:DKS), which has a Hold rating and a $200 price target. According to InvestingPro data, Foot Locker’s stock has shown strong momentum with a 9.8% year-to-date return, though current analysis suggests the stock is trading above its Fair Value.
Foot Locker’s first quarter results, released today, matched the expectations set by the pre-announcement on May 15, 2025, which had already indicated performance below consensus estimates. The company has opted not to conduct an earnings call following these results. The analyst noted that despite store remodels and an updated loyalty program, sales trends remained weak, especially when compared to the same quarter in the previous year. InvestingPro analysis reveals the company maintains a healthy current ratio of 1.7, with liquid assets exceeding short-term obligations, though revenue showed a 2.2% decline in the last twelve months.
The report suggested that Dick’s Sporting Goods faces significant challenges in integrating and revitalizing Foot Locker. Poser highlighted the differences between the two companies, pointing out that Foot Locker operates on a distinct model, caters to a different customer base, and has considerable international exposure, particularly in the EMEA region, which accounted for 19.4% of Foot Locker’s total sales in the first quarter of 2025.
The increased price target from Williams Trading reflects the agreed acquisition price of $24 per share offered by Dick’s Sporting Goods. The analyst’s commentary underscores the operational differences and the potential difficulties Dick’s may encounter as it works to incorporate Foot Locker into its business structure.
In other recent news, Foot Locker announced the approval of an amendment to its 2007 Stock Incentive Plan during its 2025 Annual Meeting of Shareholders. Shareholders also elected directors for a one-year term and approved executive compensation and the ratification of KPMG LLP as the independent auditor for fiscal year 2025. In a significant development, Dick’s Sporting Goods has agreed to acquire Foot Locker for $24 per share, totaling a transaction value of $2.4 billion, with the deal expected to close in the second half of 2025. Analysts have reacted to this announcement with Jefferies, Citi, Barclays, and JPMorgan all raising their price targets for Foot Locker to $24. Jefferies and Citi maintained their Hold and Neutral ratings, respectively, while Barclays downgraded Foot Locker from Overweight to Equal Weight. JPMorgan upgraded the stock from Underweight to Neutral, citing the acquisition’s potential to improve Foot Locker’s business outlook. These developments reflect a strategic shift for Foot Locker as it navigates a challenging economic environment and prepares for the merger with Dick’s Sporting Goods.
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