Back to top

Image: Bigstock

Here's Why Steven Madden (SHOO) Marches Ahead of Its Industry

Read MoreHide Full Article

Steven Madden, Ltd. (SHOO - Free Report) has strategically positioned itself for sustained success in the competitive landscape through a multi-faceted approach encompassing international expansion, digital innovation and strategic acquisitions. By remaining agile, customer-centric and value-focused, the company continues to chart a course of growth and innovation in the global fashion industry.

The stock has outpaced the Zacks Shoes and Retail Apparel industry. In the past year, shares of this Zacks Rank #3 (Hold) company have gained 31.8% against the industry’s decline of 9.5%.

Analysts seem quite optimistic about the company. The Zacks Consensus Estimate for its 2024 sales and earnings per share (EPS) is pegged at $2.22 billion and $2.62, respectively, indicating year-over-year growth of 12.1% and 6.9%.

 

Zacks Investment Research
Image Source: Zacks Investment Research

 

Digging Deeper

A standout achievement for Steven Madden lies in its robust international expansion efforts. Despite macroeconomic challenges, the company's international segment has maintained impressive growth momentum, particularly evident in the first quarter of 2024. With a notable 15% increase in international revenues, Steven Madden has effectively penetrated global markets, leveraging strategic joint ventures and tailored marketing strategies to deepen consumer engagement on a global scale.

The company's strong performance across its wholesale, direct-to-consumer and licensing segments further underscores the efficacy of its strategic initiatives. In the first quarter of 2024, wholesale revenues rose 21%, driven by substantial gains in footwear, accessories and apparel. Notably, the handbag and apparel categories experienced remarkable growth, bolstering the company's wholesale segment.

The direct-to-consumer segment also demonstrated healthy growth, with total revenues reaching $112.3 million, rising 12.8% year over year. Brick-and-mortar revenues expanded 15%, or 8% on a comparable store basis, indicating continued success in physical retail.

Steven Madden's commitment to enhancing its e-commerce presence underscores its proactive stance in adapting to evolving consumer preferences. Strategic investments in digital marketing and website optimization, along with initiatives, such as try-before-you-buy payment options and expanded delivery and return capabilities, reflect the company's dedication to improving the digital shopping experience. These efforts are expected to drive continued growth in e-commerce revenues.

Strategic acquisitions, such as that of Almost Famous and BB Dakota, signify Steven Madden's concerted effort to diversify product offerings and expand market reach. These acquisitions broaden the company's apparel category and strengthen its direct-to-consumer presence, aligning with its objective of delivering profitable growth.

With a robust business framework, the company is well-positioned to capitalize on market growth opportunities and deliver enhanced value to its stakeholders. Management’s projections for 2024 indicate year-over-year revenue growth of 11-13%, with adjusted earnings per share between $2.55 and $2.65, suggesting growth from the $2.30 per share reported in 2023.

3 Promising Stocks

A few better-ranked stocks are The Gap, Inc. , Abercrombie & Fitch Co. (ANF - Free Report) and Canada Goose (GOOS - Free Report) .

Gap is a premier international specialty retailer offering a diverse range of clothing, accessories and personal care products. The company 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 Gap’s fiscal 2024 earnings and sales indicates growth of 17.5% and 0.1%, 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. The company flaunts a Zacks Rank of 1 at present. ANF delivered a 28.9% earnings surprise in the last reported quarter.

The consensus estimate for Abercrombie’s current fiscal-year earnings and sales indicates growth of 47.5% and 10.5%, respectively, from the fiscal 2023 reported figures. ANF has a trailing four-quarter average earnings surprise of 210.3%.

Canada Goose is a global outerwear brand. It sports a Zacks Rank of 1 at present.

The Zacks Consensus Estimate for Canada Goose’s current fiscal-year earnings indicates growth of 13.7% from the year-ago period’s reported figures. GOOS has a trailing four-quarter average earnings surprise of 70.9%.


Zacks' 7 Best Strong Buy Stocks (New Research Report)


Valued at $99, click below to receive our just-released report
predicting the 7 stocks that will soar highest in the coming month.


Click Here, It's Really Free

Published in