Famous Footwear Parent Caleres Stock Plunges on Soft Sales
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Key TakeawaysCaleres, the parent of discount shoe retailer Famous Footwear, said weak demand, a later back-to-school period, and challenges with its resource planning system hurt second-quarter results.The footwear company missed quarterly profit and sales estimates, and cut its full-year outlook.The news sent Caleres shares into negative territory for 2024.
Caleres (CAL) shares plunged Thursday when the footwear company significantly missed estimates and slashed its outlook on soft demand, a later back-to-school sales period, and technical problems.The parent of the Famous Footwear retail chain, Allen Edmonds, and other brands posted second-quarter earnings per share (EPS) of 85 cents, more than 30% below the consensus estimate of analysts surveyed by Visible Alpha. Revenue dropped 1.8% year-over-year to $683.3 million, also short of forecasts.Famous Footwear unit sales were up 1.5%, but comparable-store sales fell 2.9%. The company's Brand Portfolio segment sales tumbled 5.1%.CEO Says Results 'Fell Short of Our Potential'Chief Executive Officer (CEO) Jay Schmidt said the results were "below expectations," and "both segments fell short of our potential." Schmidt said that Caleres "experienced weak seasonal demand and back-to-school business came later than expected." He added that challenges with the implementation of the company's enterprise resource planning (ERP) system "led to lack of visibility" for its products, hurting sales.Caleres now anticipates full-year adjusted EPS of $4.00 to $4.15, compared with its previous outlook of $4.30 to $4.60. It sees sales down a low-single-digit percent versus the earlier guidance of flat to up 2%.Shares of Caleres sank nearly 20% to $29.93 Thursday afternoon to fall into negative territory for the year. Read the original article on Investopedia.
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