Citi Downgrades Steven Madden (SHOO) to Neutral, 'Margin Headwinds Limit EPS Upside in F24E'

Citi analyst Paul Lejuez downgraded Steven Madden (NASDAQ: SHOO) from Buy to Neutral with a price target of $41.00.

The analyst comments "We are downgrading SHOO from Buy to Neutral ahead of 4Q23 EPS (2/28 BMO). We expect a slight 4Q beat of $0.59 (vs cons $0.57) and believe SHOO performed well in a tough environment in F23. However, as we look to F24, margin headwinds from higher freight, potentially higher promos in retail/higher private label sales in wholesale and the impact of Almost Famous (AF) leave us more cautious on earnings upside potential, even as solid fashion trends point to an inflection in SHOO’s core wholesale footwear business in Spring ’24. We expect mgmt to guide F24 EPS conservatively (we estimate a guidance range of $2.40-2.50 vs cons $2.74). With shares up 25% since early Nov and trading at 12.5x our F24E EV/EBITDA estimate, we believe the risk/reward is more balanced at current levels. See below for takeaways from our mgmt meeting at the FFANY shoe show."

For an analyst ratings summary and ratings history on Steven Madden click here. For more ratings news on Steven Madden click here.

Shares of Steven Madden closed at $41.83 yesterday.

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