Foot Locker (FL) shares opened a staggering 85% up today after Dick’s Sport Goods Inc (DKS) confirmed plans of acquiring the troubled footwear retailer for $2.4 billion. 

Dick’s buyout proposal that values FL shares at $24 is “the best path for our shareholders,” said Mary Dillon, the chief executive of Foot Locker in a press release on Thursday. 

The agreement enables FL investors to receive that amount in cash or opt for 0.1168 DKS shares instead. Following today’s explosive move, Foot Locker stock is up more than 100% versus its year-to-date low. 

Did You Miss the Opportunity in Foot Locker Stock?

FL shares are already trading just below the deal price of $24, indicating little to no room for future gains. 

Buyout agreements tend to cap a stock’s upside potential, leaving investors with minimal profit opportunities unless a higher bid emerges – something that seems unlikely in Foot Locker’s case. 

Additionally, if this deal faces regulatory hurdles or unexpected delays, FL stock could even dip below the buyout price.  

Put together, the aforementioned narrative suggests it’s already too late to buy Foot Locker shares. 

Is the FL Deal a Positive for Dick’s Sporting Goods Stock?

Dick’s Sporting Goods expects the Foot Locker deal to help with international expansion and open its business to a wider, more diversified customer base. 

Still, John Kernan, a TD Cowen analyst, says the FL buyout doesn’t offer a good enough reason to invest in DKS shares either. 

Kernan dubbed the agreement a “strategic mistake” in his research note this morning, adding risks related to synergies and integration could lead to disappointing return on capital. 

On Thursday, the investment firm downgraded DKS stock to “Hold,” saying “there’s no precedence of M&A at scale creating value for shareholders within Softline Retail.”

Other Wall Street Analysts Remain Bullish on DKS Shares

Other Wall Street analysts, however, are not as dovish on Dick’s Sporting Goods stock for 2025. 

The consensus rating on DKS shares currently sits at “Moderate Buy” with the mean target of about $238 indicating potential upside of more than 30% from current levels.