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Investing.com - BTIG lowered its price target on Steven Madden (NASDAQ:SHOO) to $34.00 from $38.00 on Wednesday, while maintaining a Buy rating following the company’s second-quarter earnings report. The footwear company, currently trading at $23.66, has seen its stock decline 36% over the past six months, though InvestingPro analysis suggests the stock is currently undervalued. The company maintains a healthy 3.19% dividend yield and has consistently paid dividends for 8 consecutive years.
The footwear company reported Q2 earnings per share of $0.20, in line with Street expectations, but missed revenue estimates by approximately $20 million due to tariff-related disruptions. These disruptions included order cancellations, delivery delays, and shipments pushed to later periods, affecting both wholesale and direct-to-consumer channels. Despite these challenges, the company maintains strong fundamentals with a current ratio of 2.25 and operates with moderate debt levels, according to InvestingPro data.
BTIG noted that about 95% of the wholesale shortfall came from off-price and mass channels, which experienced "a complete pause" in orders before China tariffs were reduced from 145%. Management expects continued pressure on these channels in Q3, though some improvement is anticipated as retailers resume accepting goods and placing forward orders.
The company has responded to tariff challenges by diversifying sourcing away from China, negotiating supplier discounts, and implementing targeted price increases. Steven Madden now expects to source approximately 30% of US imports from China for Fall, down from over 70% last year but higher than management’s previous mid-teens percentage expectation.
Despite these challenges, BTIG highlighted positive factors including strong sell-through for the core brand and significant momentum at Kurt Geiger, which presents a substantial growth opportunity. The firm believes Steven Madden remains positioned to capture market share and restore margins as headwinds diminish, despite the volatile tariff situation. With revenue growth of 10.34% and a P/E ratio of 10.15, the company shows promising fundamentals. For deeper insights into Steven Madden’s valuation and growth prospects, including 8 additional ProTips and comprehensive financial analysis, visit InvestingPro.
In other recent news, Steven Madden Ltd reported its earnings for the second quarter of 2025. The company’s earnings per share (EPS) exceeded expectations, coming in at $0.20 compared to the forecast of $0.18, marking an 11.11% surprise. However, revenue did not meet projections, totaling $559 million, which was below the anticipated $578.41 million, a shortfall of 3.36%. Despite the positive EPS results, the revenue miss has raised concerns among investors, particularly amid ongoing tariff challenges. The mixed financial performance highlights the complexities the company faces in the current market environment. These developments are crucial for investors to consider as they evaluate the company’s financial health and future prospects.
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