Executive Summary

• Foot Locker reported 2Q16 revenues of $1.78 billion, up 5.0% from the year-ago quarter and above the consensus estimate of $1.76 billion. Reported EPS were $0.94, up 11.9% year over year and exceeded expectations of $0.94. Both sales and earnings results were better than expected.
• Comps were up 4.7% with sales driven by positive comparable sales across basketball, running, and classic footwear, as well as apparel.
• The company maintained fiscal 2016 guidance of comps up mid-single digits and EPS up double digits in line with the consensus of +10.0% or $4.72. For 3Q16, management expects EPS to increase “close to” double digits versus the consensus of +12.0% or $1.12.