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Steve Madden (SHOO - Free Report) beat fourth-quarter EPS estimates by 4 cents and guided higher for 2010.

This Zacks Rank #2 stock is up nearly 55% since being added to the Focus List in May 2009.

Company Description

Steve Madden designs and markets fashion-forward footwear and accessories for women, men and children. It sells shoes and accessories in its 85 company-owned retail stores, department stores, specialty stores, and online.

Fourth-Quarter Results

On February 25, Steve Madden announced sales of $139.5 million, a year-over-year increase of 17.1%, with comparable-store sales of 7%. The company's EPS grew 83% to $0.73, topping the Zacks Consensus Estimate by $0.04.

Management said that its boot sales continue to drive the company's strong results.

Looking ahead to 2010, the company expects sales growth of 11% to 13% and earnings per share between $3.10 and $3.30. Longer term, Steve Madden believes it can double its earnings in the next five years.

Earnings Estimates

After Steve Madden reported solid fourth-quarter results and gave bullish 2010 guidance, analysts following the company pushed up their earnings estimate. This increased the Zacks Consensus Estimate for 2010 from $2.96 to $3.23 and the Zacks Consensus Estimate for 2011 from $3.11 to $3.65.

Strong Fundamentals

The company's return on equity (ROE) of 21% is well ahead of the industry average of 15%. SHOO's net profit margin is 10%, doubling the industry average of 5%. Steve Madden also has a debt-free balance sheet, compared to the industry average, which is 5%.

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