The shares just flashed a bullish signal on the charts, too
The shares of Foot Locker, Inc. (NYSE:FL) are up 1.6% at $56.36 this morning, after analysts at B. Riley FBR upgraded the retail stock to "buy" from "neutral." The brokerage firm also hiked its price target on FL to $73 from $62, and said the stock's recent pullback creates an attractive entry point for bulls. Further, the analysts waxed optimistic on Foot Locker's footwear pipeline and same-store sales prospects ahead of the company's turn in the earnings confessional next Friday, May 24.
From a technical perspective, it does, in fact, look like an opportune time to bet on a Foot Locker bounce. Since topping $64 in April, the shares have backpedaled to their 160-day moving average -- a historically bullish signal. Over the past three years, there have been eight other times FL retreated to this trendline after a lengthy stretch above it. After these signals, the stock was up 7.03%, on average, a month later, and higher 86% of the time, per data from Schaeffer's Senior Quantitative Analyst Rocky White.
Despite FL's channel of higher highs and lows since late 2017, more than half of the analysts following the equity maintain tepid "hold" or worse opinions. Should the company report strong earnings next week, another dose of upbeat analyst attention could help the shoe concern extend its quest for new highs.
In addition, a strong earnings showing could shake loose some short sellers. Short interest represents nearly 10% of Foot Locker's total available float, and would take more than a week to buy back, at the equity's average pace of trading.