Foot Locker Slides After Cowen Downgrade

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Foot Locker Slides After Cowen Downgrade
Credit: © Reuters.

By Sam Boughedda -- Foot Locker, Inc. (NYSE: FL ) fell in early Monday trading after the stock was downgraded by analysts at Cowen, who also lowered the price target to $34 from $42.

In a research note, Cowen analyst John Kernan, who downgraded the shares to Market Perform from Outperform, said he is moving to the sidelines despite a "cheap valuation." 

The assessment is based on inbound data into March regarding digital traffic and search trends, which are averaging 14% lower year-over-year in 2022. 

Furthermore, Kernan noted that Similarweb, a company that tracks website traffic data, shows unique visitor traffic data for is down 21% year-over-year.

Even though his estimates are "fairly in line with guidance" for FY 2022, the analyst believes inflationary trends from the supply chain could be underappreciated in the second half of 2022 and FY 2023.

Foot Locker shares are down 4% Monday, adding to their 30% year-to-date loss.

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