Steven Madden: Navigating Tariff Relief and Fashion Trends Amidst Sales Pressures and Cost Challenges

Analyst Paul Lejuez from Citi maintained a Hold rating on Steven Madden (SHOO – Research Report) and keeping the price target at $26.00.

Paul Lejuez’s rating is based on a combination of factors that present both opportunities and challenges for Steven Madden. The recent removal of worst-case tariffs on Chinese imports has created a more positive outlook, allowing the company to maintain more production in China than previously planned. Additionally, fashion trends are shifting in favor of Steven Madden’s product lines, particularly in dressier footwear, which could enhance brand appeal and customer traffic, as evidenced by the recent viral moment involving founder Steve Madden.
However, there are still uncertainties that justify a Hold rating. The company faces ongoing sales pressure from order cancellations and a lack of reorder demand, despite the easing of tariffs. Moreover, production costs in alternative countries like Cambodia and Brazil remain significantly higher compared to pre-tariff China, which could impact margins. The consumer market also appears to have softened, and while there are no expected shortages, the potential for over-supply later in the season remains a concern. These mixed signals suggest a cautious approach, warranting a Hold recommendation.

SHOO’s price has also changed dramatically for the past six months – from $46.010 to $24.800, which is a -46.10% drop .