Stock Market Today: Why Foot Locker and GameStop are on the Move

What you need to know about today's stock market.

May 23, 2014 at 9:25AM

The Dow Jones Industrial Average (DJINDICES:^DJI) has dropped an insignificant one point in pre-market trading, suggesting a quiet start to the stock market today. Volatility has crept out of stocks lately as markets hover around record highs. In fact, the VIX index, or "fear gauge," hit a 14-month low yesterday as traders bet on stocks to stay within a narrow range. 

But even in the calmest market a few individual stocks will see heavy trading. Foot Locker (NYSE:FL) and GameStop (NYSE:GME) are playing that role this morning after the retailers announced their quarterly earnings results.

Foot Locker this morning posted earnings that beat estimates on both the top and bottom lines. The athletic-apparel retailer's profit jumped higher by 22% to reach a record $1.10 a share. Wall Street analysts were looking for first-quarter earnings of $1.06. Comparable-store sales rose by a healthy 8% to fuel a 14% bounce in total revenue, also beating the consensus projection. Foot Locker "delivered results in line with or better than our expectations on just about every financial and operational metric," Chief Financial Officer Lauren Peters said in a press release. Besides that impressive sales growth, the metric that investors probably liked the most is profitability, which ticked higher to 34.6% of sales from 34.2% a year ago. The stock was up 2.3% in pre-market trading.

Gme Store

GameStop last night booked a 28% spike in quarterly profit as shoppers flocked to its stores to buy new gaming consoles from Microsoft and Sony. The video game retailer's sales rose by 7% to $2 billion, led by an 81% surge in hardware sales, which includes the popular Xbox One and PlayStation 4 devices. There were two particularly good pieces of news in this report for shareholders. First, GameStop's highly profitable pre-owned business grew to 30% of sales from 20% in the prior quarter. Second, the company expects overall revenue growth to ramp up in the second quarter: comparable-store sales are forecast to rise by as much as 19%, well ahead of this past quarter's 6% mark. The stock was up 4.5% in pre-market trading.

Demitrios Kalogeropoulos has no position in any stocks mentioned. The Motley Fool owns shares of GameStop and Microsoft. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

A Financial Plan on an Index Card

Keeping it simple.

Aug 7, 2015 at 11:26AM

Two years ago, University of Chicago professor Harold Pollack wrote his entire financial plan on an index card.

It blew up. People loved the idea. Financial advice is often intentionally complicated. Obscurity lets advisors charge higher fees. But the most important parts are painfully simple. Here's how Pollack put it:

The card came out of chat I had regarding what I view as the financial industry's basic dilemma: The best investment advice fits on an index card. A commenter asked for the actual index card. Although I was originally speaking in metaphor, I grabbed a pen and one of my daughter's note cards, scribbled this out in maybe three minutes, snapped a picture with my iPhone, and the rest was history.

More advisors and investors caught onto the idea and started writing their own financial plans on a single index card.

I love the exercise, because it makes you think about what's important and forces you to be succinct.

So, here's my index-card financial plan:


Everything else is details. 

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