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Monday, Williams Trading analysts raised the price target for Shoe Carnival stock (NASDAQ: NASDAQ:SCVL) to $21 from $17, while maintaining a Hold rating. This adjustment follows Shoe Carnival’s strong first-quarter earnings for 2025 and the company’s continued guidance for fiscal year 2025. According to InvestingPro analysis, the stock appears slightly undervalued, trading at a P/E ratio of 8.04 with strong financial health metrics.
The decision to increase the price target comes amid Shoe Carnival’s efforts to rebrand its stores under the Shoe Station name. By March 2027, Shoe Station stores are expected to account for over 80% of the company’s total store base, a significant increase from the previous target of 51%. By the end of the second quarter of 2026, Shoe Station is anticipated to represent 51% of the store base, with year-over-year sales and margin growth expected to improve at that time. The company maintains a healthy gross profit margin of 35.4% and has consistently paid dividends for 14 consecutive years, as noted by InvestingPro.
In the first quarter of 2025, Shoe Station sales increased by 4.9%, while the rebranded Shoe Station locations experienced double-digit comparable sales increases. However, Shoe Carnival’s overall sales dropped by 10%, and same-store sales decreased by 8.1%, highlighting the necessity for the expansion of Shoe Station. This performance reflects broader challenges, with the stock down over 45% in the past six months, though the company maintains strong liquidity with a current ratio of 3.67.
Rogan sales remained steady year-over-year at $19 million, with integration plans proceeding as expected. During the first quarter of 2025, 24 Shoe Carnival stores were converted to Shoe Station stores, though the temporary closures for these conversions negatively impacted same-store sales by approximately 1%. For detailed analysis and additional insights, investors can access the comprehensive Pro Research Report available on InvestingPro, which covers over 1,400 US stocks.
In other recent news, Shoe Carnival Inc. reported its first-quarter earnings for 2025, with earnings per share (EPS) beating expectations at $0.34 compared to the forecasted $0.30. The company’s revenue, however, fell short, coming in at $277.7 million against the anticipated $284.9 million, marking a 7.5% year-over-year decline. Despite the revenue shortfall, Shoe Carnival ended the quarter with $93 million in cash and no debt, reinforcing its solid financial position. The company also reaffirmed its full-year 2025 guidance, projecting net sales between $1.15 billion and $1.23 billion and EPS ranging from $1.60 to $2.10.
Shoe Carnival’s strategic focus on expanding its Shoe Station brand is showing promise, as the brand achieved a sales growth of 4.9% in the quarter. This growth contrasts with the overall decline in the family footwear industry and the company’s own Shoe Carnival banner, which saw sales decline by 10%. Analysts from firms like Williams Trading and Seaport Research Partners have noted the company’s strategic shift and the potential for future growth through the Shoe Station brand. Additionally, Shoe Carnival plans to accelerate its rebranding efforts, with Shoe Station expected to represent over 80% of its store fleet by March 2027.
The company remains committed to pursuing mergers and acquisitions to achieve its long-term vision of becoming the leading footwear retailer for families. Despite the challenging retail environment, Shoe Carnival’s strategic initiatives and strong financial foundation position it well for future growth.
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