Expectations For Finish Line's Q1 Earnings

Buckingham Research Group restated its Buy rating on Finish Line Inc FINL with a $25 target price, about 45 percent higher than the current price.

Buckingham changed its EPS estimate for the first quarter of 2017 below consensus, but kept yearly estimates steady, as it believes April and May results will be weaker than forecasted, driven by low mall traffic trends and lower-than expected basketball sales.

According to the analysts, the company's profitability will be drastically increased because of better execution under the new leadership.

Buckingham forecasts a 5.4 percent margin for 2016, which is significantly lower than its record of 9.9 percent achieved in 2012, but still sufficient for the company to generate nearly $80 million of Free Cash Flow corresponding to 10 percent yield.

The $25 price target is based on the estimated 13.5 multiple and EPS of $1.82 for the fiscal 2017 year.