I put $17,000 in this Stock Today! Why?
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Today I share with you a stock that I just put $17,000 in called Footlocker. Ticker on this one is FL and I think I will probably double my money or more in this stock the next few years along with get some great dividend income.
I would definitely put this stock in the stock to buy now category rather than stocks to watch. LMK in the comments if you think this is a stock to. buy now or stock to watch!
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Well guys here today I just put 17 $1,000 into a stock that I like very very much let’s put it that way okay as I told you guys in a video I released one day or two ago I basically said in that video there’s about five to 10 value stocks out there that I absolutely love right now.
Okay not grow stocks I’m talking value stocks either turnaround plays or stocks that have been heavily been down in aren’t like super popular stocks that are known out there by everybody but are the valuations are just too dang compelling and guess what this stock is one of those stocks I mentioned in that video okay, and I would say this I would say it was almost.
I almost want to call the stock in easy money stock I won’t go as far as to say that okay, because that is a very illustrious category when I say something’s an easy money stock I almost put this one in that category but it didn’t quite make it okay by the way you know two stocks have ever made it to the easy money category Okay.
Apple stock obviously back when it was 100 something dollars a share I did a whole video and I literally called apple and easy money stock like in the title that video was like two and a half years ago or so and then the FB always called that an easy money stock and you know to this day still FB is an easy money stock long term okay.
But those are only two stocks I’ve ever given that term easy money stock to this one almost made it but I didn’t quite make it okay, which means this is a very attractive ROI opportunity if it almost made that category Okay, so in this video here today.
I’m gonna tell you exactly what the stock is I’m gonna tell you what price I paid was actually going to show you what price I paid for the shares here today I’m going to show you exactly how many shares I own in total at the moment with the stock how many shares.
I plan to own worth the stock prices I want to buy for the stock and lastly, we’ll go through the real meat of this video which is my bullish thesis in detail about this stock so you guys can learn a lot not just about my perspective on this stock, but exactly how I you know, look into stock and kind of how my thought process goes around a stock like this.
So hope you guys enjoyed today’s video as always, if you don’t mind smash that thumbs up button I do appreciate each and every one of you guys that always smash that thumbs up that helps out the YouTube channel in a massive, massive way.
So I do appreciate you guys that also if you’re looking to scale your stock market portfolio to six figures, seven figures and beyond go ahead and check out the first link in the description down there no allow you to fill out an application if your application is accepted.
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Okay, already guys, let’s get into this. So what stock is this? It is footlocker stock, a ticker symbol FL and oh my goodness. am I excited about this stock? This is an under $30 stock here today. Okay. footlocker. I mean, a lot of you guys know footlocker, right.
You know, you go into footlocker store and you usually buy Well, you could buy clothes, but most people go in there to buy a new pair of shoes of some kind. That’s where a lot of people go to shop for shoes, okay, they also own kids Foot Locker, they own champs sports, they own foot action as well.
And they own several online brands such as East Bay calm, runners point sidestep shoes, and actually just made a huge investment last year in an app called goat with some of you guys might know is a very popular reselling app for shoes.
Okay, now what price that I pay for the shares? How many shares do I own at the moment prices? I’m looking to continue to buy it and then we’ll get into my bullish thesis after that. Okay, so here today I bought 300 shares at 29 1750.
And I bought another 285 shares at 29 1714. Okay, the order is put in all at once, it just went under two different prices. And so that was over $17,000 here Today I bought worth of footlocker stock, that is those shares in that particular account there 585 shares at a 2917 cost basis there.
So breakeven, obviously just bought it here before the close. And then I also own some more shares another account other 615 shares, though, when I got a really nice cost basis on Okay, 2581 I love Love, love that cost basis.
Especially that one we’re already up to $1,000 on my own footlocker shares in another account 560 shares that when we’re down 1% on that’s thinking the dividends only account and believe, or then the public count, I can’t remember it’s in one of those accounts. And that one cost base is 2948.
So that one’s the most expensive cost basis of the bunch. So all in total, we own over $50,000 worth of footlocker shares as of right now, okay, I think I could buy at least another $50,000 worth of this stock, especially if the stock doesn’t move here over the next few months.
And when I say move, I mean go up like you know, 20% or 30% or 40% or something like that. So as long as it stays anywhere remotely close to where I bought the shares at previously, like I can easily buy another $50,000 worth of stock and I exceptionally loved the stock when it’s under $30 a share Okay, that’s when it’s like.
You know, that’s when I almost can put it in an easy money category. Like I said, I can’t quite go that far with it. But it’s pretty dang close. Okay, when you can get shares of this stock for under $30 a share.
And let me be very clear 30 to $35 for stock is still very attractive to me, that is still buying territory for me in regards to footlocker stock anywhere from 30 to 35, level, even 35 to 40, I will say that that’s when it becomes like, it’s a good ROI opportunity.
Whereas like under 30, in my opinion, it’s like an unbelievably attractive ROI or opportunity, like the chance to lose money in the stock over the next five years, I think very low chance you make really good money in the stock over the next five years.
I think really high. I think if I’m buying anywhere from 30 to $35, I think it’s still extremely, extremely attractive ROI opportunity. When we get to 35 to 40. I feel like it’s a good, it’s a good ROI opportunity.
But it’s not a great ROI opportunity at that moment for me. And if it goes above $40 a share, that’s when I’m not interested in buying anymore. At that point, I’m just interested in holding my shares if it goes over 40 Okay, because then it’s just like.
I was just called a so so ROI opportunity, if I’m buying shares at let’s say 40 to 45 $48, something like that. It’s just a hold for me at that point. Okay, now, what is my bullish thesis? Why am I so excited about this stock, and I’ve got to be really excited about it right to own over $50,000 worth of it already.
And be willing to buy another $50,000 plus make this into a six figure position. I have to and I like to stock Okay, so what is it about this stock? Well, we’re gonna start with this one is it’s a $3 billion market cap, okay, that’s what I’m paying for this entire company, here today. $3 billion.
Okay, let’s go ahead and pull up the last three years of the income statement, okay. And keep in mind, this is a business over the last three years has made a ton of investments in the business and kind of focusing their business more on online in store pickups, and just kind of like the new age of retail.
Okay, and not just being so focused on just like a mall based retailer, but focus on like a store that it can thrive in any type of space, okay. And they’ve done a lot of investments over the last few years and still been able to put a very nice number $7.7 billion of revenue three years ago, two years ago, 7.9 billion, this past year, over $8 billion of revenue.
Look at the net income 284 million, then 541 million this past year, almost a half a billion dollars in net income on that bottom line. And remember, something very important, we are paying $3 billion total for this company. Okay? So at a, let’s say, a half a billion dollar net income, we’re paying a six a six p on this business model. Okay.
That is unbelievably low. I mean, especially in this market. I mean, that’s just ridiculous. This is why you know, when I when I look at things like this, this is why I can almost put the stock into an easy money category, because evaluation is just so cut down.
And so with the valuation being so cut down, you would think footlocker is business model would be trashed right now, and the truth is, it can’t be further from the trash. Okay, this business model is clicking on all cylinders right now.
They just reported earnings three days ago, and Wall Street slept on this completely okay, which is absolutely preposterous. And ridiculous. Look at these earnings. They were shockingly good. Okay, second quarter comp store sales increase 18.6%.
Now, you might think, well, maybe that’s a quarter over quarter number. No, that’s year over year. Okay. Think about that for a moment in this type of environment where stores were even, you know, a lot of stores for them were partially closed.
And when they did reopen, people were scared about you know, could they get Ronnie Roan if they went out in the public and things like that, and to still put up a calm store sale number of 18.6%. Guys, that is ridiculously good.
Like I knew the business model was a lot stronger than what Wall Street was giving it credit for. But I had no clue. It was that unbelievably strong. Like Think about that. A year ago. Everything was perfect in the world, right?
And this year, everything’s not perfect into report an 18.6% comp store sales number. Ridiculous. Anybody that knows anything about retail or restaurants knows that numbers Absolutely. disgustingly good. Like ridiculous, okay, second quarter net income came in at $45 million.
So not only is a company have an amazing comp store sales, but they’re already back to profitability. Isn’t that amazing how fast his business went from, you know, their, their stores are all closed. They’re taking a huge loss to us. And now they’re already on a gap basis back to profitability.
On non GAAP basis. They reported net income of 75 million or 71 cents a share. Unbelievable numbers, guys, I mean, you you can’t ask for better numbers in this type of environment. The Board of Directors declared a dividends they’re gonna start paying dividends already.
I thought it wasn’t going to be till 2021 when they started, you know, paying dividends again. And that was one of the reasons I was bullish on the stock. I was like, Oh, the 2021 they’ll start paying dividends again. That’s going to be a great thing. Start getting that dividend cash flow again.
No, they’re already going to start paying them out. Again, okay, because they’re already profitable, very nicely profitable already. Unbelievable. I mean, just unbelievable. Then on the conference call, they said something like online sales were up like 107 73% if I recall you over year, it was like 100 something percent.
I think it was like 173% they sat on the conference call. That is ridiculous. Okay. Now keep in mind with footlocker online sales are a much smaller chunk of their business, then obviously selling in physical stores.
But still for online stores to be that strong online sales like it just proves that this management team has done a phenomenal job of building up that business and people taking more seriously not just going into footlocker store but if they want to order shoes, go to footlocker calm or any of the other brands that this company owns.
So that is unbelievable as well. And I love love love seeing now Okay, let’s talk about this balance sheet. Okay, now you would have thought with this whole Ronnie Ronnie situation, the balance sheet would have gotten far worse for footlocker I mean, far, far worse, right?
I mean, heck, their stores that’d be close ahead, take huge losses all these things, right? The balance sheet improved year over year and dramatically. Look at this. Now, Mellon, they have $1.37 billion in cash compared to the same quarter last year, they had 939 million. So now they have like, what $400 million plus more cash this year.
In this quarter versus last year in the same quarter? That is unbelievable. Okay, so you would have thought, oh, maybe debt went up a ton? Nope. long term debt went down for this company. Okay, but $2 million. Unbelievable.
And you know what else went down? their long term lease obligations went down as well, because they’re basically being able to negotiate with a lot of their landlords. It’s called that right in the commercial space for a lot cheaper rents.
And that’s really exciting as well. So I mean, when you look at this business model already back to a very nice profitability com store sales up 18% year over year, just insane dividend already going to start being paid back again.
And keep in mind is only 15 cents compared to what they have 4345 cents of VPS. Right? a balance sheet that’s stronger, actually way stronger, year over year. This is incredible. Okay, simply incredible.
What about my channel checks, you know, if I own any type of physical retail, or any type of physical business in general, I love to do channel checks. I go around, see the stores? Are they busy? Things like that. People you know, they like to, you know, some people not most of you guys don’t.
But some people like to laugh at that, oh, Jeremy goes to drives around these stores and to see if they’re busy. That’s just ridiculous. That tells them work, does it I can tell you this has made me more money than probably anything ever in the history of mankind. Okay.
And I can tell you, I’ve been going around doing channel checks for at least the last month or two if not longer than that for footlocker and the stores are generally much busier than I remember full hawkers being let’s just put that way, especially on the weekends.
Just yesterday I was at the Summerlin location DTS K. Get my son, a new pair of shoes. Okay. And I could tell you that footlocker was packed, I mean, absolutely jam packed. I mean, when I got done in line, there was like three or four other parties behind me waiting to pay for this stuff.
I’m like, Huh, business looks pretty dang decent. This is certainly no ghost town situation here. And as it comes to our sales will show you it’s definitely not that situation. Keep in mind online businesses growing 100% plus for them.
So it’s not just about people like myself going into the physical store and seeing a pair of shoes and be like, I want to get those shoes. It’s about all those people that are buying online right now and getting those shoes delivered to their house.
Okay, so I mean, this is just, you know, I love it. I love it. Okay, and I want to point out something that I’ve seen, it’s a big difference. You guys remember back in the day 57 had that popular song was I use a Windows shop, looking at stuff you know, you can buy Okay, my rapping skills might not be on par.
Okay, but 50 cent had that window shopper song, right? And honestly, you know, that’s what I used to feel like a lot of people that if they were going to footlocker, any store, I felt like the majority of people were going in as a window shopper rather than buying stuff.
And I felt like that was just stores in general. And right now, I can tell you people go in the store, they’re buying crap, man. They’re walking out with bags. I mean, the amount of customers I see walk into a store and then walk out with nothing is a much lower percentage than I’ve ever seen pretty much in my life, and especially over the last couple years, okay.
P if you’re going to footlocker, you’re going with an agenda, you’re probably going to buy something, okay. And this is just the stores in general. It’s a completely different like change I’ve seen from consumers out there, and its consumers across the board in every single class.
It’s quite interesting. Okay. Now some people want to say you know, it’s because the stimulus money now stimulus checks Well, people are going to spend that some people are saying well, it’s unemployment.
Some people are making more on unemployment than they were with their regular jobs and people are saying well, it was a mortgage and the rent forbearance and things like that so it was a lot of different people saying a lot of different reasons but I can tell you you know all that’s part of it, but I think there’s also a bigger change in consumer sentiment out there. Okay.
The fact is you I mean just think about this for a moment you can’t spend money on so many things people are spending money on before right i mean imagine I want to go the Vegas Golden Knights game right?
Imagine and what does that stadium 14 16,000 people all those people paying hundreds of dollars for tickets, then they are buying you know all types of stuff while the act the game and all those different things and they got to pay parking fees and this and that, and all sudden it’s fine.
Six $700 they would usually spend in that arena is empty, right? Because no one can go. So no one can spend that money there, right? And you think about what about the UFC fight that would usually draw, you know, 10s of 1000s of people and all those people would spend hundreds or 1000s of dollars to be at that UFC fight. Guess what?
You can’t even do that right now. I mean, imagine concerts all around the United States, I mentioned how big of a business that is, you know, all I mean, that’s we’re talking, that’s a business that if you add up everything that’s directly or indirectly impacted from that it can be 10s of billions of dollars, right?
And I mean, if you want to go to concert, you can’t right now, there’s no such thing as I’m gonna go to the big concert tonight. And then I’m going to spend $150, particular $300, particular whatever, and then buy a bunch. No, you can’t do that. Right?
You want to go to the bar with your friends, you can’t do that. You can’t go spend 100 200 bucks on drinks tonight. You can’t go on that cruise, right? You can’t go to Hawaii, you can’t do all these things that you would usually do. Right?
You planned out that European trip for the past two years. And now you can’t go on that European trip the way what you saved, you know, $10,000 for whatever. I mean, people just have your money coming out of their pockets right now. Okay?
People have this like stack of money that they just can’t spend it. You just can’t spend it because a lot of the activities, especially anything that’s travel related, or experiential related, which takes a lot of people’s money out of their pockets, right?
They can’t even do that right now, man. So they got this money just burning a hole through their pocket, and not a lot of people like that they have to spend their money, okay? I mean, think about this for a moment. Imagine you’re, you’re a homebuilder, right.
And you’re you’re like, you know, who helped build houses and you’re out there in the heat every day, building those houses, man working your butt off to make some money, right? I mean, you think those guys just gonna build those houses and be like, No.
I don’t ever want to, but no, of course, they want to go out and spend some money. That’s a good feeling. Man, you work hard. You bust your butt, make some money, so you can buy something you want to do, right? And that’s most people out there, right? Imagine you’re my sister, right?
And you’re a nurse and you’re running around the hospital all day, you know, helping people out and all these sorts of things. And you make you know, money and you make good money, right? And it’s like, you know, you’re this nurse, you think you just want to like, never spend any money?
No, of course not. You want to spend some money. You wanna do some online shopping, you want to do some retail shopping, like, it’s a good feeling to spend some money or at least most people find it a good feeling to actually spend some money buy something they want, or obviously buy something they need, but buy something they want. You may not need it. Okay?
For you know, every one of my buddies Graham Steffen right there, he’s a one and 100 case if not less than that, right? Most people don’t save every penny that comes in or almost every penny, they want to go out there and spend money okay?
There’s some people that actually feel bad if they go out there and spend money, right? That’s not most people. Most people feel they have a good feeling. If they go out there and spend money, they have a good like psychological feeling go out there buying something they want, or they need or something like that, like, Oh.
I just went out bought the spongy, like want related things, right. And so you know, people like Graham, that’s just that’s just very few and far between. And so this is a group This is just great news for footlocker in that and because people got money that’s burning a hole through their pocket, and they want to go out and spend the dang money.
And so there’s not a lot of things you can go out and spend money on right now. I’ll be honest, you know, retail stores or open restaurants are at like half capacity. So restaurants, it’s even hard to spend money on restaurants.
And like I said travel and all those experiential things that are massive businesses that take a ton of money out of consumers pockets. You just can’t do those right now. Okay, you can’t go to the club. Okay, go get some bottle service.
And it’s just not it’s not happening right now. Okay. And it’s not just footlocker I’ve seen this on a whole gamut of different businesses, right. Louis Vuitton? I mean, I go by the Louis Vuitton store.
I never seen as many people shopping I’m talking legit shopping and Louis Vuitton stores I’ve seen now like usually if I go by Louis Vuitton stores here in Vegas is like maybe one or two people in the stores like usually for the most part they’re they’re fairly dad. Okay.
Unless it’s a super busy night just on the strip or something like that. But usually, these stores are not busy. And I can tell you when I go by the Louis stores I’m strip they’re like, actually busy, especially on like, Friday, Saturday, Sundays. It’s weird. It’s actually really weird.
There’s like lines to get in and the stores full. I’m like, What is going on? And then you look at Louis Vuitton earnings, and their revenue was up, their earnings were up, everything was up for them.
It’s a it’s a weird environment we’re in right now. I’ll be completely honest. But it kind of makes sense. When you just understand that there’s so many less things you can spend money on right now. Hey, why not go buy a new pair of shoes at footlocker, a new pair of Nike shorts, a footlocker whatever it is, okay.
And that’s why I think physical retail is actually benefiting huge right now as well as online. We saw those Amazon numbers. They were ridiculous. Right, those Amazon numbers Bebo for 7 billion towards Apple numbers to write. And so yeah, I mean, I love footlocker stock. I love the footlocker stock.
It’s not just a short term. It’s a long term setup of this business, how focused they’ve been on kind of getting this business ready for 2020 to 2030, which I feel like the business model is ready to dominate in 2020 through 2030.
I think they put in a lot of work behind the scenes over the last several years way before I’ve ever been involved with the stock and I love it. And I might also look at 2023 call options for the stock Which those call options should come out.
Within the next month or so I would say I mean, usually September, maybe October is when those 2023 calls will start coming out or at least they should start coming out. And I’ll be interested to look at those and have like a 35 to $40 strike price and kind of see what those are pricing and maybe even like a 32 if they price their 30 to 50, something like that.
Okay, so as far as what do I feel with the stock, I feel like I’ll get a 2x plus opportunity on the stock price over the next five years. And I also believe I’m gonna get a ton of dividend money paid out to me as well over the next five years, every single quarter, I think this will be a cash flow machine stock for me.
And I think I’ll get some very very nice capital appreciation on the stock over the next five years. And so definitely check out the video I posted you know, a day or two ago on this channel about basically you know.
What’s going on the stock market how there’s not a lot of opportunities out there with these big growth stocks that are super populated everybody’s already bought into and the funds have already bought into but some of these value stocks where no one’s looking right now some of these value stocks are where the real opportunities are in the market in my personal opinion right now.
So definitely check out that video there. If you guys don’t mind smash that thumbs up button as always helps out the YouTube channel huge and I do appreciate you and also if you’re looking to hopefully try to join that private group, go and apply and somebody high up from my team will hopefully be able to get on a phone call with you.
Like I said, I think we’re booked up for August now but you can hopefully try to book a call for September if your application goes through. Thank you for watching and have a great day.