Foot Locker (FL) missed Q2 profits, revenue and margins estimates, driving the stock to a 52-week low. The sneaker and apparel chain is now down more than 50% for the year. FL reported same store sales were down YOY(6%) for the first time since 2009, perhaps signaling the end of the long-running athletic footwear bull market. CEO Richard Johnson stated the company will be aggressive in reviewing its 3300+ store fleet and intends on closing more than the 100 stores announced earlier this year, to get the company back on track.
Howie Long-Short: NKE is telling us they see future growth in direct to consumer sales. FL is telling us that the NKE/AMZN partnership is not an imminent threat to their business. It certainly sounds like cognitive dissonance to me.
Fan Marino: The elephant in the room? Basketball sneakers simply aren’t fashionable with kids right now.