Shares of Foot Locker Inc. FL, -2.50% fell back by 1.3% in premarket trades on Monday, after a 20% jump in the previous session on plans by the company to hire Mary Dillon, the former CEO of Ulta Beauty Inc. ULTA, -1.65%, as its chief executive officer starting on Sept. 1. Following the news, Morgan Stanley analyst Alex Straton upgraded Foot Locker to equal-weight from underweight and raised the company’s stock price target to $36 a share from $24 a share. A halo effect from new CEO Dillon is taking a front seat while company fundamentals take a back seat, near term, Straton said. “Dillon is a very accomplished retail executive with over 35 years of experience…and is well respected by the market for her impressive track record,” Straton said. “The stock could trade at higher levels until investors have more/less conviction around her ability to transform the business.”
