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SHOO Stock Trades Above 200 & 50-Day SMA: What's Next for Investors?
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Steven Madden, Ltd. (SHOO - Free Report) has demonstrated strong upward momentum, trading above its 200-day and 50-day simple moving averages (SMA). SMA is a key indicator of price stability and long-term bullish trends. SHOO closed Friday’s trading session at $49.35, ahead of its 200-day and 50-day SMA of $42.57 and $44.96, respectively. This technical strength, along with sustained momentum, reflects positive market sentiment and investor confidence in SHOO's financial health and growth prospects.
Image Source: Zacks Investment Research
Shares of the company have showcased an impressive price hike over the past year, climbing 53.5% and surpassing the Zacks Shoes and Retail Apparel industry’s 13.2% decline. This resulted from SHOO’s enhanced operational efficiency and direct-to-consumer (DTC) business, which have helped it outperform the broader Consumer Discretionary sector and the S&P 500 index’s respective growth of 18.2% and 32.2% in the same period.
This impressive uptick has left many investors wondering if they missed out on a lucrative opportunity or if there is still potential for growth. This leading footwear and accessories retailer is inching toward its 52-week high of $50.01 attained on Oct. 1, 2024, reflecting strong investor confidence and market optimism.
Steve Madden has effectively pursued a multi-faceted growth strategy, focusing on diversification and expansion across various segments. A key driver has been its emphasis on the DTC model and international markets.
By expanding beyond its core footwear business into categories such as handbags and apparel, and enhancing its digital capabilities, the company saw significant revenue increases in these areas in the second quarter. The acquisition of Almost Famous bolstered its apparel segment, adding to Steve Madden’s upward growth momentum.
The wholesale division posted impressive results, with revenues rising 22.5% year over year to $385.3 million in the second quarter of 2024. Particularly noteworthy was the 86% surge in wholesale accessories and apparel revenues, reflecting the company's successful diversification beyond footwear. Excluding the Almost Famous acquisition, wholesale revenues increased 8.2%, whereas accessories and apparel revenues rose 29.8%.
The DTC segment also demonstrated strength, with a 6.4% increase in year-over-year revenues to $136.4 million. Comparable DTC sales grew 4.1%, supported by well-curated product offerings and efficient inventory management, which helped minimize markdowns.
In addition to diversifying its product categories, Steve Madden has been aggressively expanding internationally, recognizing this as a key pillar for growth. International revenues rose 13% year over year in the second quarter, with the EMEA region leading the charge. The company expects EMEA revenues to grow by more than 20% in 2024.
Steve Madden’s Financial Stability & Growth Prospectus Ahead
SHOO’s second-quarter financials underscore its solid financial standing and disciplined capital management. As of June 30, 2024, the company reported $180.5 million in cash and equivalents, along with $11.8 million in short-term investments, indicating a strong liquidity position. With no outstanding debt, the company’s financial discipline is evident.
Looking ahead, Steve Madden is well-positioned to seize growth opportunities both domestically and internationally. The recovery in the U.S. wholesale footwear business signals improved inventory management and strengthened relationships with retail partners. The company anticipates a year-over-year revenue rise of 11-13% for 2024, with adjusted earnings per share of $2.55-$2.65, suggesting growth from the $2.30 reported in 2023.
SHOO Stock’s Attractive Valuation
From a valuation perspective, the stock presents an attractive opportunity, trading at a discount relative to the industry benchmark. With a forward 12-month price-to-sales ratio of 1.55, which is below the industry average of 2.21 in the past year, the stock offers compelling value for investors seeking exposure to the sector. It currently has a Value Score of A, further validating its appeal.
Image Source: Zacks Investment Research
Conclusion
Investors may find Steven Madden appealing due to its strong growth momentum, driven by diversification, operational efficiency and international expansion. The company's focus on direct-to-consumer channels and successful entry into product categories, such as handbags and apparel, have contributed to its robust performance, outpacing industry benchmarks. SHOO's stock demonstrates technical strength, trading above key moving averages, signaling stability and long-term bullish trends.
With a solid financial foundation, no debt and an attractive valuation, Steven Madden is positioned to capitalize on growth opportunities, making it an attractive investment option. The company currently carries a Zacks Rank #2 (Buy).
Nordstrom is a leading fashion specialty retailer in the United States. The company offers an extensive selection of both branded and private-label merchandise. It currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Nordstrom’s fiscal 2024 sales indicates growth of 0.6% from the fiscal 2023 reported figure. JWN has a negative trailing four-quarter average earnings surprise of 17.8%.
Abercrombie is a specialty retailer of premium, high-quality casual apparel. It flaunts a Zacks Rank of 1 at present. ANF delivered a 16.8% earnings surprise in the last reported quarter.
The consensus estimate for Abercrombie’s fiscal 2025 earnings and sales indicates growth of 63.4% and 13.1%, respectively, from the fiscal 2024 reported levels. ANF has a trailing four-quarter average earnings surprise of 28%.
Build-A-Bear Workshop is the leading and only national company providing a make-your-own stuffed animal interactive retail-entertainment experience. It currently carries a Zacks Rank of 2.
The Zacks Consensus Estimate for Build-A-Bear Workshop’s fiscal 2024 earnings and sales indicates growth of 8.8% and 1.2%, respectively, from the fiscal 2023 reported figures. BBW has a negative trailing four-quarter average earnings surprise of 3.9%.
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SHOO Stock Trades Above 200 & 50-Day SMA: What's Next for Investors?
Steven Madden, Ltd. (SHOO - Free Report) has demonstrated strong upward momentum, trading above its 200-day and 50-day simple moving averages (SMA). SMA is a key indicator of price stability and long-term bullish trends. SHOO closed Friday’s trading session at $49.35, ahead of its 200-day and 50-day SMA of $42.57 and $44.96, respectively. This technical strength, along with sustained momentum, reflects positive market sentiment and investor confidence in SHOO's financial health and growth prospects.
Image Source: Zacks Investment Research
Shares of the company have showcased an impressive price hike over the past year, climbing 53.5% and surpassing the Zacks Shoes and Retail Apparel industry’s 13.2% decline. This resulted from SHOO’s enhanced operational efficiency and direct-to-consumer (DTC) business, which have helped it outperform the broader Consumer Discretionary sector and the S&P 500 index’s respective growth of 18.2% and 32.2% in the same period.
This impressive uptick has left many investors wondering if they missed out on a lucrative opportunity or if there is still potential for growth. This leading footwear and accessories retailer is inching toward its 52-week high of $50.01 attained on Oct. 1, 2024, reflecting strong investor confidence and market optimism.
Image Source: Zacks Investment Research
SHOO’s Strategic Expansion & Diversification Fuel Growth
Steve Madden has effectively pursued a multi-faceted growth strategy, focusing on diversification and expansion across various segments. A key driver has been its emphasis on the DTC model and international markets.
By expanding beyond its core footwear business into categories such as handbags and apparel, and enhancing its digital capabilities, the company saw significant revenue increases in these areas in the second quarter. The acquisition of Almost Famous bolstered its apparel segment, adding to Steve Madden’s upward growth momentum.
The wholesale division posted impressive results, with revenues rising 22.5% year over year to $385.3 million in the second quarter of 2024. Particularly noteworthy was the 86% surge in wholesale accessories and apparel revenues, reflecting the company's successful diversification beyond footwear. Excluding the Almost Famous acquisition, wholesale revenues increased 8.2%, whereas accessories and apparel revenues rose 29.8%.
The DTC segment also demonstrated strength, with a 6.4% increase in year-over-year revenues to $136.4 million. Comparable DTC sales grew 4.1%, supported by well-curated product offerings and efficient inventory management, which helped minimize markdowns.
In addition to diversifying its product categories, Steve Madden has been aggressively expanding internationally, recognizing this as a key pillar for growth. International revenues rose 13% year over year in the second quarter, with the EMEA region leading the charge. The company expects EMEA revenues to grow by more than 20% in 2024.
Steve Madden’s Financial Stability & Growth Prospectus Ahead
SHOO’s second-quarter financials underscore its solid financial standing and disciplined capital management. As of June 30, 2024, the company reported $180.5 million in cash and equivalents, along with $11.8 million in short-term investments, indicating a strong liquidity position. With no outstanding debt, the company’s financial discipline is evident.
Looking ahead, Steve Madden is well-positioned to seize growth opportunities both domestically and internationally. The recovery in the U.S. wholesale footwear business signals improved inventory management and strengthened relationships with retail partners. The company anticipates a year-over-year revenue rise of 11-13% for 2024, with adjusted earnings per share of $2.55-$2.65, suggesting growth from the $2.30 reported in 2023.
SHOO Stock’s Attractive Valuation
From a valuation perspective, the stock presents an attractive opportunity, trading at a discount relative to the industry benchmark. With a forward 12-month price-to-sales ratio of 1.55, which is below the industry average of 2.21 in the past year, the stock offers compelling value for investors seeking exposure to the sector. It currently has a Value Score of A, further validating its appeal.
Image Source: Zacks Investment Research
Conclusion
Investors may find Steven Madden appealing due to its strong growth momentum, driven by diversification, operational efficiency and international expansion. The company's focus on direct-to-consumer channels and successful entry into product categories, such as handbags and apparel, have contributed to its robust performance, outpacing industry benchmarks. SHOO's stock demonstrates technical strength, trading above key moving averages, signaling stability and long-term bullish trends.
With a solid financial foundation, no debt and an attractive valuation, Steven Madden is positioned to capitalize on growth opportunities, making it an attractive investment option. The company currently carries a Zacks Rank #2 (Buy).
Other Key Picks
Some other top-ranked stocks are Nordstrom Inc. (JWN - Free Report) , Abercrombie & Fitch Co. (ANF - Free Report) and Build-A-Bear Workshop (BBW - Free Report) .
Nordstrom is a leading fashion specialty retailer in the United States. The company offers an extensive selection of both branded and private-label merchandise. It currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Nordstrom’s fiscal 2024 sales indicates growth of 0.6% from the fiscal 2023 reported figure. JWN has a negative trailing four-quarter average earnings surprise of 17.8%.
Abercrombie is a specialty retailer of premium, high-quality casual apparel. It flaunts a Zacks Rank of 1 at present. ANF delivered a 16.8% earnings surprise in the last reported quarter.
The consensus estimate for Abercrombie’s fiscal 2025 earnings and sales indicates growth of 63.4% and 13.1%, respectively, from the fiscal 2024 reported levels. ANF has a trailing four-quarter average earnings surprise of 28%.
Build-A-Bear Workshop is the leading and only national company providing a make-your-own stuffed animal interactive retail-entertainment experience. It currently carries a Zacks Rank of 2.
The Zacks Consensus Estimate for Build-A-Bear Workshop’s fiscal 2024 earnings and sales indicates growth of 8.8% and 1.2%, respectively, from the fiscal 2023 reported figures. BBW has a negative trailing four-quarter average earnings surprise of 3.9%.