Foot Locker, Inc. (NYSE:FL), is not the largest company out there, but it received a lot of attention from a substantial price increase on the NYSE over the last few months. While good news for shareholders, the company has traded much higher in the past year. With many analysts covering the mid-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. However, what if the stock is still a bargain? Let’s take a look at Foot Locker’s outlook and value based on the most recent financial data to see if the opportunity still exists.

Check out our latest analysis for Foot Locker

What's The Opportunity In Foot Locker?

The stock is currently trading at US$27.98 on the share market, which means it is overvalued by 31% compared to our intrinsic value of $21.34. This means that the opportunity to buy Foot Locker at a good price has disappeared! But, is there another opportunity to buy low in the future? Since Foot Locker’s share price is quite volatile, this could mean it can sink lower (or rise even further) in the future, giving us another chance to invest. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.

Can we expect growth from Foot Locker?

Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio. Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. Though in the case of Foot Locker, it is expected to deliver a relatively unexciting top-line growth of 5.0% in the next few years, which doesn’t help build up its investment thesis. Growth doesn’t appear to be a main reason for a buy decision for the company, at least in the near term.

What This Means For You

Are you a shareholder? It seems like the market has well and truly priced in FL’s future outlook, with shares trading above its fair value. However, this brings up another question – is now the right time to sell? If you believe FL should trade below its current price, selling high and buying it back up again when its price falls towards its real value can be profitable. But before you make this decision, take a look at whether its fundamentals have changed.

Are you a potential investor? If you’ve been keeping tabs on FL for some time, now may not be the best time to enter into the stock. The price has surpassed its true value, which means there’s no upside from mispricing. However, the positive outlook means it’s worth diving deeper into other factors in order to take advantage of the next price drop.