Update shared on 21 Nov 2025
Fair value Decreased 14%Narrative Update: Shoe Carnival Analyst Price Target
Analysts have lowered Shoe Carnival’s fair value estimate from $22.00 to $19.00, citing weaker-than-expected back-to-school sales and a more cautious outlook on the company’s growth and profitability metrics.
Analyst Commentary
Bullish Takeaways- Bullish analysts note that the company’s value-driven positioning could appeal to budget-conscious consumers, especially in uncertain economic conditions. This may provide some protection against broader retail headwinds.
- Opportunities remain for market share gains in athletic and casual footwear, particularly if management continues to refine its merchandising and inventory strategies.
- Shoe Carnival’s strong balance sheet and low debt levels offer flexibility to invest in strategic initiatives or to navigate near-term market volatility.
- Bearish analysts express concern that a lackluster back-to-school selling season may signal weaker demand and impaired sales momentum leading into the critical holiday quarter.
- Reduced earnings visibility and a more cautious profit outlook have led to lowered price targets and, in some cases, the removal of price targets altogether.
- Slower expected top-line growth and pressure on margins present challenges for valuation, raising questions about the company’s ability to execute its longer-term growth strategy.
What's in the News
- Shoe Carnival updated its earnings guidance for fiscal year 2025, increasing the lower end of its EPS outlook to a range of $1.80 to $2.10 after strong third quarter results and accelerated rebanner execution (Key Developments).
- The company provided earnings guidance for fiscal 2026, anticipating net sales to decline in the first half, with a return to growth in the second half as Shoe Station expands. It expects EPS to be lower than fiscal 2025 due to investments and lower sales (Key Developments).
- W. Kerry Jackson was appointed Chief Financial Officer, effective September 28, 2025, returning to the role after previously serving as CFO for 27 years. Patrick C. Edwards becomes Senior Vice President, Treasurer (Key Developments).
- Shoe Carnival reported no share repurchases between May and September 2025 under its previously announced buyback program (Key Developments).
- Second quarter and back-to-school results exceeded market expectations, prompting a raised 2025 GAAP EPS outlook to between $1.70 and $2.10 and projecting a slowing of sales declines in the second half of the year (Key Developments).
Valuation Changes
- Fair Value Estimate: Lowered from $22.00 to $19.00. This reflects a more cautious earnings outlook and softer growth prospects.
- Discount Rate: Increased slightly from 9.6% to 10.4%. This indicates higher perceived risk in future cash flows.
- Revenue Growth Assumption: Reduced substantially from 1.4% to 0.2% per year. This points to a more subdued sales trajectory.
- Net Profit Margin: Lowered from 5.0% to 3.8%. This highlights expected pressure on profitability.
- Future P/E: Raised from 12.9x to 15.9x. This suggests a higher valuation multiple is being applied despite a more modest growth and profit outlook.
Disclaimer
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