Designer Brands stock price target raised to $4.50 from $4.00 at UBS

Investing.com - UBS raised its price target on Designer Brands (NYSE:DBI) to $4.50 from $4.00 on Wednesday, while maintaining a Neutral rating on the footwear retailer’s stock. The new target represents a 7.4% upside from the current price of $4.19, with InvestingPro data showing the stock is trading slightly below its calculated Fair Value.

The investment firm expects Designer Brands to report third-quarter earnings per share approximately 2 cents above consensus estimates, citing modestly improved fundamentals during the period. With earnings scheduled for December 9 (just 6 days away), investors should note that the company posted a diluted EPS of -$0.65 over the last twelve months.

Despite the anticipated earnings beat, UBS believes Designer Brands will likely refrain from reinstating its fiscal year 2025 guidance due to ongoing uncertainty surrounding tariffs.

UBS notes that Designer Brands shares have already climbed 12.5% over the past month, compared to a relatively flat S&P 500, suggesting that positive early holiday season performance may already be priced into the stock.

The firm anticipates less volatility than the typical 10.5% price movement that historically accompanies Designer Brands’ earnings reports, as market participants will likely focus on fourth-quarter-to-date trends rather than significant changes to sentiment or valuation multiples.

In other recent news, Designer Brands Inc. has announced key changes and developments. The company declared a quarterly cash dividend of $0.05 per share for both Class A and Class B common shares, set to be paid on October 17, 2025. Additionally, Designer Brands expanded its board of directors by appointing Deborah Ferrée as a Class II director, effective immediately. In executive news, CFO Jared Poff will resign by October 31, 2025, with Mark Haley stepping in as the interim CFO starting November 1, 2025.

The company has also entered into a partnership with Uber Technologies to offer products through the Uber Eats platform, making nearly 500 DSW stores available for on-demand delivery across the contiguous United States. Meanwhile, UBS has reiterated a Neutral rating on Designer Brands, citing limited long-term growth potential despite the company’s strong market position. UBS pointed to the maturity of Designer Brands’ DSW banner and a high concentration in seasonal footwear as factors constraining growth. These developments reflect Designer Brands’ ongoing strategic adjustments and market activities.

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