Williams Trading Lifts Shoe Carnival (SCVL) PT to $21 on Strong Q1 2025 Earnings

On Monday, Williams Trading analyst Sam Poser increased the price target for Shoe Carnival Inc. (NASDAQ:SCVL) to $21 from $17, while maintaining a Hold rating on the stock. This adjustment follows Shoe Carnival’s stronger-than-expected Q1 2025 earnings, which were released on May 30, and the company’s reaffirmed FY2025 guidance.

While net sales declined by 7.5% year-over-year to $277.7 million, and comparable store sales dropped by 8.1%, the company’s net income of $0.34 per diluted share surpassed expectations by ~10%. A key driver for Shoe Carnival’s positive outlook, despite the overall sales decline, is the performance of the Shoe Station banner. Shoe Station sales increased by 4.9% in Q1, with rebranded locations experiencing double-digit comparable sales increases. This contrasts with the Shoe Carnival banner, which saw a 10% decline in sales. The company is pursuing its rebanner initiative and aims for Shoe Station stores to constitute over 80% of its total store base by March 2027, which is up from the previous target of 51%.

In Q1 2025 alone, 24 Shoe Carnival stores were converted to Shoe Station stores. However, these temporary closures negatively impacted overall same-store sales by ~1%. The company expects to invest a total of $30 million to $40 million in capital expenditures for this initiative in FY2025, with $10 million already spent in Q1. Shoe Carnival Inc. (NASDAQ:SCVL) operates as a family footwear retailer in the US.

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Disclosure: None. This article is originally published at Insider Monkey.