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If you are building a properly diversified stock portfolio, the chances are some of your picks will perform badly. But the long term shareholders of Foot Locker, Inc. (NYSE:FL) have had an unfortunate run in the last three years. Unfortunately, they have held through a 61% decline in the share price in that time. And more recent buyers are having a tough time too, with a drop of 51% in the last year. Furthermore, it's down 44% in about a quarter. That's not much fun for holders. We note that the company has reported results fairly recently; and the market is hardly delighted. You can check out the latest numbers in our company report.

If the past week is anything to go by, investor sentiment for Foot Locker isn't positive, so let's see if there's a mismatch between fundamentals and the share price.

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There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS).

During five years of share price growth, Foot Locker moved from a loss to profitability. We would usually expect to see the share price rise as a result. So it's worth looking at other metrics to try to understand the share price move.

We think that the revenue decline over three years, at a rate of 4.2% per year, probably had some shareholders looking to sell. After all, if revenue keeps shrinking, it may be difficult to find earnings growth in the future.

You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).

Foot Locker is well known by investors, and plenty of clever analysts have tried to predict the future profit levels. You can see what analysts are predicting for Foot Locker in this interactive graph of future profit estimates .

What About The Total Shareholder Return (TSR)?

Investors should note that there's a difference between Foot Locker's total shareholder return (TSR) and its share price change, which we've covered above. The TSR attempts to capture the value of dividends (as if they were reinvested) as well as any spin-offs or discounted capital raisings offered to shareholders. Dividends have been really beneficial for Foot Locker shareholders, and that cash payout explains why its total shareholder loss of 57%, over the last 3 years, isn't as bad as the share price return.