Latest news with #BrandPortfolio
Yahoo
30-05-2025
- Business
- Yahoo
CAL Q1 Earnings Call: Management Cites Tariff and Sourcing Headwinds, Suspends Guidance
Footwear company Caleres (NYSE:CAL) missed Wall Street's revenue expectations in Q1 CY2025, with sales falling 6.8% year on year to $614.2 million. Its non-GAAP EPS of $0.22 per share was 39.7% below analysts' consensus estimates. Is now the time to buy CAL? Find out in our full research report (it's free). Revenue: $614.2 million (6.8% year-on-year decline) Adjusted EPS: $0.22 vs analyst expectations of $0.37 (39.7% miss) Adjusted Operating Income: $12.21 million vs analyst estimates of $19.4 million (2% margin, 37.1% miss) Operating Margin: 1.9%, down from 6.6% in the same quarter last year Market Capitalization: $558.4 million Caleres' first quarter results were shaped by softer consumer demand and operational pressures across both its Brand Portfolio and Famous Footwear segments. CEO Jay Schmidt pointed to particularly weak February sales, with some improvement in March and April, though overall performance remained below plan. Management attributed the underperformance to lower gross margins, higher inventory reserves, and increased costs tied to sourcing disruptions and tariffs. Schmidt acknowledged, 'Our first quarter results fell short of expectations,' highlighting the company's exposure to both macroeconomic volatility and specific industry challenges. Additional factors included higher-than-anticipated bad debt write-downs, as customer credit conditions worsened compared to last year. Looking ahead, Caleres is suspending formal guidance due to ongoing volatility in tariffs and global sourcing. Management emphasized a focus on cost controls and structural expense reductions, with CFO Jack Calandra detailing a $15 million annualized SG&A reduction initiative. The company is also navigating uncertainty around tariff timelines and potential sourcing disruptions, which could impact both gross margins and inventory. Schmidt noted, 'We must redouble our efforts to drive growth and profitability,' while also pointing to upcoming product launches and store format changes, such as the broader rollout of the Jordan brand and continued expansion of FLAIR locations, as key initiatives to support future performance. The planned integration of Stuart Weitzman is expected to further diversify the portfolio. Management cited tariff escalation, sourcing disruption, and inventory management as the primary drivers behind the quarter's margin and earnings pressure, while highlighting selective strength in international and direct-to-consumer channels. Tariff and sourcing disruption: The company experienced increased costs and operational complexity from shifting production out of China following new U.S. tariffs. This led to order cancellations, higher costs to relocate manufacturing, and additional inventory write-downs, which collectively pressured gross margins. Inventory management challenges: Caleres was unable to adjust its inventory flow quickly enough as demand softened, resulting in elevated inventory levels and a need for higher markdown reserves, especially in its Brand Portfolio segment. International segment growth: Despite overall declines, international sales—particularly from the Sam Edelman brand—showed double-digit growth, supported by expansion in China, the Middle East, and new marketplace partnerships. Management views these international gains as a strategic counterbalance to domestic softness. Brand Portfolio performance: Lead brands such as Sam Edelman outperformed others, with new product assortments like sneakers and sandals resonating well in key markets. However, Allen Edmonds and Naturalizer faced distinct category challenges, and Vionic's decline was attributed to a timing shift in catalog drops. Famous Footwear and product initiatives: The Famous Footwear segment experienced sequential sales improvement during the quarter, aided by growth in e-commerce and the launch of new brands and store formats. The introduction of the Jordan brand and continued rollout of FLAIR stores are anticipated to boost performance in upcoming periods. Caleres' outlook is shaped by volatile tariff policies, cost-saving initiatives, and evolving consumer demand across its core segments. Tariff environment remains fluid: Management has suspended forward guidance due to ongoing uncertainty around U.S. tariffs on Chinese and global imports. Sourcing disruption and possible further escalation or reversal of tariffs could materially affect gross margins and inventory costs in the next several quarters. Expense reduction and operational efficiency: The company is implementing a $15 million annualized SG&A reduction, with savings expected to materialize in the second half of the year. This initiative is designed to offset profit pressure from lower sales and higher sourcing costs, though management noted that further opportunities for efficiency may emerge as integration partners assess the business. Product and format innovation: Upcoming launches, such as the full-door rollout of the Jordan brand at Famous Footwear and expanded FLAIR store locations, are expected to drive renewed customer engagement. Management also cited ongoing investment in international markets and the integration of Stuart Weitzman as potential growth levers, even as domestic wholesale order books remain 'fluid.' Over the coming quarters, the StockStory team will track (1) the company's ability to reduce inventory and capture anticipated SG&A savings, (2) the impact of new product launches—particularly the Jordan brand rollout and FLAIR store conversions—on segment sales, and (3) progress on the integration and performance of Stuart Weitzman. The evolution of global tariff policy and sourcing costs will also be critical to monitor. Caleres currently trades at a forward P/E ratio of 4.4×. Should you double down or take your chips? See for yourself in our full research report (it's free). Market indices reached historic highs following Donald Trump's presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth. While this has caused many investors to adopt a "fearful" wait-and-see approach, we're leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking out our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025). Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today. Sign in to access your portfolio
Fashion Network
29-05-2025
- Business
- Fashion Network
Caleres Q1 sales drop 6.8%, announces $15 million cost cuts
Caleres said on Thursday revenues for the first quarter fell 6.8%, on the back of a dip in both its Famous Footwear and Brand Portfolio segment. The St. Louis-based footwear company reported sales of $614.2 million, below expectations, for the 13-weeks ended May 3. Earnings per diluted share were $0.21, or $0.22 on an adjusted basis—well below the $0.88 reported in the same quarter last year. Famous Footwear segment net sales decreased 6.3%, with comparable sales down 4.6%; while Brand Portfolio segment net sales declined 6.9%. Direct-to-consumer channels continue to be a significant portion of the company's sales, accounting for approximately 70% of total net sales. 'While our brands continue to resonate with consumers and both segments of our business gained market share in the period, our first quarter results fell short of expectations,' said Jay Schmidt, president and chief executive officer. 'February sales were particularly weak, and although trends improved in March and April, overall performance was below plan. Furthermore, operating earnings were pressured by lower gross margins, increased reserves, and costs to cancel and move inventory.' In response, Caleres announced structural cost-cutting measures expected to reduce selling, general and administrative (SG&A) expenses by $15 million annually, including $7.5 million in savings for fiscal 2025. The company also said it expects to significantly reduce sourcing from China, projecting that less than 10% of dollars will be sourced from the country in the second half of 2025. 'The operating environment has become more challenging, and we must redouble our efforts to drive growth and profitability. In the near term, we are focused on controlling what we can control, including optimizing our sourcing strategy,' added Schmidt. 'Longer term, we are confident in our ability to get back on track, execute our strategic plan, invest to fuel our growth initiatives, and drive sustained value for our shareholders.' Due to ongoing macroeconomic uncertainty, the company has suspended its full-year fiscal 2025 guidance.
Yahoo
14-05-2025
- Business
- Yahoo
Caleres, Inc. (CAL): One of the Underperforming Stocks Targeted By Short Sellers
We recently published a list of . In this article, we are going to take a look at where Caleres, Inc. (NYSE:CAL) stands against other underperforming stocks targeted by short sellers. Short interest refers to the percentage of publicly available shares that have been sold short. It is an indicator used by many investors to determine how strong a company's bear thesis may be. Due to the nature of short selling, the short interest has become a popular indicator among investors. The reason it is given so much weightage is that people betting against a stock have usually done solid research and are confident of a company's downfall. They take unlimited risk, so when big investors or the smart money shorts a stock, people take notice. They try to unearth the red flags that may have prompted the high short interest. We decided to dig deeper and try to find out where smart money sees trouble ahead. To come up with our list of 20 underperforming stocks targeted by short sellers, we looked at the worst-performing stocks of the last six months and then ranked them by the short interest. A sneaker factory production line, showcasing the manufacturing process of the company's products. Short interest: 15.71% 6 months' performance: -49.56% Caleres, Inc. (NYSE:CAL) is a developer, designer, manufacturer, sourcer, and seller of footwear. The company generates its revenue through the Brand Portfolio and Famous Footwear segments. It provides private-label, licensed, and branded athletic, dress, and casual footwear products. The firm's sales performance remained challenging, with Famous Footwear comparable sales down by 3% and Brand Portfolio sales down by 7%. Due to high fixed costs and lower sales, the company faces margin pressure. Caleres' operating margins significantly declined to 2% in Q4 from 5%. For the full year, operating margins dropped by 5.8%. Caleres, Inc. (NYSE:CAL)'s capital allocation decisions highlight further risks. In 2024, the company prioritized shareholders' returns instead of paying off debt. As a result, the amount of debt increased to $220 million from $190 million in the last year. The latest acquisition of Stuart Weitzman will further cost $105 million, increasing debt by 50%. Stuart Weitzman, which is an unprofitable brand, will require significant investment, which is likely to also pressure margins. Overall, CAL ranks 12th on our list of underperforming stocks targeted by short sellers. While we acknowledge the potential of CAL as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than CAL but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock. READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires. Disclosure: None. This article is originally published at Insider Monkey.
