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Steven Madden (SHOO) Gains on Diversification & Market Expansion
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Steven Madden, Ltd.’s (SHOO - Free Report) strategic initiatives, including its focus on diversification, digital growth and international expansion, have laid a strong foundation for continued success. The company's solid financial performance in second-quarter 2024 highlights its ability to navigate challenges and seize growth opportunities, positioning it well for long-term value creation for stakeholders.
The stock has outpaced the Zacks Shoes and Retail Apparel industry in the past year. Shares of this Zacks Rank #2 (Buy) company have risen 21.4% against the industry’s 27% decline during the same time frame.
Analysts seem quite optimistic about the company. The Zacks Consensus Estimate for its 2024 sales and EPS is pegged at $2.22 billion and $2.62, respectively, indicating year-over-year growth of 12.3% and 6.9%. Also, the consensus estimate for 2025 sales and EPS is pegged at $2.33 billion and $2.93, respectively, implying year-over-year growth of 4.7% and 11.7%.
Image Source: Zacks Investment Research
Let’s Explore Deeper
Steven Madden has shown a solid strategic approach to driving growth across various segments, with particular emphasis on direct-to-consumer (DTC) business and international markets. The company's focus on expanding categories beyond footwear, such as handbags and apparel, and leveraging digital capabilities has proved successful, with significant revenue increases across these segments in the second quarter. The acquisition of Almost Famous has further strengthened its apparel offerings, contributing to the company's robust growth trajectory.
The wholesale business demonstrated strong performance with revenues increasing 22.5% year over year to $385.3 million in the second quarter. Notably, Wholesale accessories and apparel revenues surged 86%, reflecting the company’s successful efforts to diversify beyond its core footwear segment. Excluding the Almost Famous acquisition, wholesale revenues grew 8.2%, with accessories and apparel revenues increasing 29.8%.
The DTC segment also demonstrated resilience, with revenues increasing 6.4% year over year to $136.4 million. Comparable DTC sales grew 4.1%, driven by strong product assortments and disciplined inventory management, which reduced the need for promotional activities.
In addition to product diversification, Steven Madden has been aggressively expanding its international footprint, which it views as a critical long-term growth opportunity. International revenues grew 13% year over year in the second quarter, with the EMEA region being a standout performer. The company expects EMEA revenues to grow more than 20% in 2024.
Strong Outlook
Looking ahead, Steven Madden is well-positioned to capitalize on growth opportunities in both domestic and international markets. The recovery in the U.S. wholesale footwear business is a positive sign of inventory normalization and improved relationships with key retail partners. For 2024, the company anticipates an 11-13% increase in revenues from 2023, with adjusted earnings expected to range between $2.55 and $2.65 per share, up from $2.30 in 2023.
Wrapping Up
Steven Madden's strong performance in both its wholesale and DTC businesses, along with its successful integration of acquisitions like Almost Famous, highlights its ability to adapt and thrive in a competitive market. With a positive outlook for 2024, the company is well-positioned to continue capitalizing on growth opportunities and enhancing its market presence, both domestically and internationally.
Other Key Picks
Other top-ranked stocks in the retail space are The Gap, Inc. , Abercrombie & Fitch Co. (ANF - Free Report) and American Eagle Outfitters Inc. (AEO - Free Report) .
The Zacks Consensus Estimate for Gap’s fiscal 2024 earnings and sales indicates growth of 24.5% and 0.2%, respectively, from the fiscal 2023 reported figures. GPS has a trailing four-quarter average earnings surprise of 202.7%.
Abercrombie is a specialty retailer of premium, high-quality casual apparel. It carries a Zacks Rank of 2 at present. ANF delivered a 28.9% earnings surprise in the last reported quarter.
The consensus estimate for Abercrombie’s fiscal 2024 earnings and sales indicates growth of 51.1% and 11.5%, respectively, from the fiscal 2023 reported levels. ANF has a trailing four-quarter average earnings surprise of 210.3%.
American Eagle Outfitters is a specialty retailer of casual apparel, accessories and footwear. It currently has a Zacks Rank of 2.
The Zacks Consensus Estimate for American Eagle Outfitters’ fiscal 2024 earnings and sales indicates growth of 17.1% and 3.3%, respectively, from the year-ago actuals. AEO has a trailing four-quarter average earnings surprise of 28.1%.
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Steven Madden (SHOO) Gains on Diversification & Market Expansion
Steven Madden, Ltd.’s (SHOO - Free Report) strategic initiatives, including its focus on diversification, digital growth and international expansion, have laid a strong foundation for continued success. The company's solid financial performance in second-quarter 2024 highlights its ability to navigate challenges and seize growth opportunities, positioning it well for long-term value creation for stakeholders.
The stock has outpaced the Zacks Shoes and Retail Apparel industry in the past year. Shares of this Zacks Rank #2 (Buy) company have risen 21.4% against the industry’s 27% decline during the same time frame.
Analysts seem quite optimistic about the company. The Zacks Consensus Estimate for its 2024 sales and EPS is pegged at $2.22 billion and $2.62, respectively, indicating year-over-year growth of 12.3% and 6.9%. Also, the consensus estimate for 2025 sales and EPS is pegged at $2.33 billion and $2.93, respectively, implying year-over-year growth of 4.7% and 11.7%.
Image Source: Zacks Investment Research
Let’s Explore Deeper
Steven Madden has shown a solid strategic approach to driving growth across various segments, with particular emphasis on direct-to-consumer (DTC) business and international markets. The company's focus on expanding categories beyond footwear, such as handbags and apparel, and leveraging digital capabilities has proved successful, with significant revenue increases across these segments in the second quarter. The acquisition of Almost Famous has further strengthened its apparel offerings, contributing to the company's robust growth trajectory.
The wholesale business demonstrated strong performance with revenues increasing 22.5% year over year to $385.3 million in the second quarter. Notably, Wholesale accessories and apparel revenues surged 86%, reflecting the company’s successful efforts to diversify beyond its core footwear segment. Excluding the Almost Famous acquisition, wholesale revenues grew 8.2%, with accessories and apparel revenues increasing 29.8%.
The DTC segment also demonstrated resilience, with revenues increasing 6.4% year over year to $136.4 million. Comparable DTC sales grew 4.1%, driven by strong product assortments and disciplined inventory management, which reduced the need for promotional activities.
In addition to product diversification, Steven Madden has been aggressively expanding its international footprint, which it views as a critical long-term growth opportunity. International revenues grew 13% year over year in the second quarter, with the EMEA region being a standout performer. The company expects EMEA revenues to grow more than 20% in 2024.
Strong Outlook
Looking ahead, Steven Madden is well-positioned to capitalize on growth opportunities in both domestic and international markets. The recovery in the U.S. wholesale footwear business is a positive sign of inventory normalization and improved relationships with key retail partners. For 2024, the company anticipates an 11-13% increase in revenues from 2023, with adjusted earnings expected to range between $2.55 and $2.65 per share, up from $2.30 in 2023.
Wrapping Up
Steven Madden's strong performance in both its wholesale and DTC businesses, along with its successful integration of acquisitions like Almost Famous, highlights its ability to adapt and thrive in a competitive market. With a positive outlook for 2024, the company is well-positioned to continue capitalizing on growth opportunities and enhancing its market presence, both domestically and internationally.
Other Key Picks
Other top-ranked stocks in the retail space are The Gap, Inc. , Abercrombie & Fitch Co. (ANF - Free Report) and American Eagle Outfitters Inc. (AEO - Free Report) .
Gap is a premier international specialty retailer, which offers a diverse range of clothing, accessories and personal care products. It currently sports a Zacks Rank #2. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
The Zacks Consensus Estimate for Gap’s fiscal 2024 earnings and sales indicates growth of 24.5% and 0.2%, respectively, from the fiscal 2023 reported figures. GPS has a trailing four-quarter average earnings surprise of 202.7%.
Abercrombie is a specialty retailer of premium, high-quality casual apparel. It carries a Zacks Rank of 2 at present. ANF delivered a 28.9% earnings surprise in the last reported quarter.
The consensus estimate for Abercrombie’s fiscal 2024 earnings and sales indicates growth of 51.1% and 11.5%, respectively, from the fiscal 2023 reported levels. ANF has a trailing four-quarter average earnings surprise of 210.3%.
American Eagle Outfitters is a specialty retailer of casual apparel, accessories and footwear. It currently has a Zacks Rank of 2.
The Zacks Consensus Estimate for American Eagle Outfitters’ fiscal 2024 earnings and sales indicates growth of 17.1% and 3.3%, respectively, from the year-ago actuals. AEO has a trailing four-quarter average earnings surprise of 28.1%.