Shoe Carnival stock price target raised to $22 by Williams Trading

Investing.com - Williams Trading raised its price target on Shoe Carnival (NASDAQ:SCVL) to $22.00 from $21.00 on Friday, while maintaining a Hold rating on the footwear retailer’s stock. The stock has shown remarkable momentum, gaining nearly 24% in the past week. According to InvestingPro analysis, the stock appears slightly overvalued at current levels, with technical indicators suggesting overbought conditions.

The price target adjustment follows Shoe Carnival’s second-quarter 2025 earnings report, which showed mixed results. The company reported earnings per share of $0.70, exceeding the consensus estimate of $0.58, despite sales falling short of expectations.

Gross margin performance was a bright spot for the retailer, exceeding consensus estimates by 270 basis points, while SG&A expenses came in 110 basis points higher than anticipated. Following these results, Shoe Carnival increased its fiscal year 2025 gross margin and EPS guidance.

Williams Trading noted initial success from conversions of Shoe Carnival stores to Shoe Station stores but expressed concern about elevated inventory levels that were "not adequately explained" and could potentially limit gross margin expansion over time.

The firm also highlighted potential risks to Shoe Carnival’s future, including possible "deterioration of SCVL’s relationship with the footwear industry," factors that likely contributed to maintaining the Hold rating despite the price target increase.

In other recent news, Shoe Carnival Inc. reported its second-quarter earnings for 2025, delivering an earnings per share (EPS) of $0.70, which exceeded analyst forecasts by 12.9%. Despite this earnings beat, the company’s revenue fell short of expectations, coming in at $306.4 million compared to the anticipated $318.3 million. This represented a 7.9% decline from the previous year. However, the company’s strategic initiatives and improved margins appeared to contribute positively to investor sentiment. Analysts from various firms noted the company’s ability to manage costs effectively, which may have aided in surpassing EPS expectations. These developments have led to increased interest from investors, despite the revenue shortfall. The company’s recent performance and strategic direction continue to be closely monitored by market analysts.

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