Market Watch: Puma, Steve Madden to Deliver Quarterly Results

The Week Ahead

Monday, July 28:
U.S. pending home sales for June

Tuesday, July 29:
Puma SE Q2 results
Iconix Brand Group Inc. Q2 results
Big 5 Sporting Goods Q2 results
U.S. consumer price index for July

Wednesday, July 30:
U.S. second-quarter GDP

Thursday, July 31:
Steve Madden Ltd. Q2 results
U.S. initial weekly jobless claims
U.S. continuing weekly jobless claims

Friday, Aug. 1:
U.S. unemployment rate for July
U.S. consumer sentiment for July
U.S. personal income for June
U.S. consumer spending for June

Stock Watch

Investors will be looking for commentary about the performance of Steven Madden Ltd.’s wholesale and retail businesses when the company reports its second-quarter results on Thursday.

Market watchers expect the company’s wholesale division to continue to post strong sales for the period, citing retailers’ trust of the brand over other junior labels as one of the key drivers of its robust track record.

Sam Poser, an analyst at Sterne Agee, raised his second-quarter earnings per share forecast for the company by 1 cent to 45 cents ahead of the result. He increased his sales forecast for the period to $319.7 million, from $313.7 million.

The Street expects Steve Madden will post sales of $313.5 million on EPS of 43 cents.

On his forecast rejigger, Poser said, “Our revenue increase is due to our confidence that Steve Madden’s wholesale business will continue to outperform the competition and take share as it did in the first quarter.”

He raised his wholesale revenue estimate for the period to $273.4 million, from $267.4 million, as a result.

“Steve Madden has executed, and will likely continue to execute, well against key trends and ideas. Unfortunately, lack of fashion trends is negatively impacting Madden’s own retail business, as owned stores carry the full assortment of styles and not only the best-sellers,” he added, noting that market sources have reported sluggish foot traffic at Steve Madden’s stores in recent months.

Steve Madden shares were 16 cents lower at $33.26 in midday trading as the S&P 500 trended lower on geopolitical concerns.

Also posting a share price decline was DSW Inc. following an earnings estimate downgrade by Poser. The analyst lowered his fiscal 2014 EPS forecast to $1.55, from $1.88, due to the impact of the recent lack of strong fashion trends and a cool start to spring.

DSW shares dropped 3.2 percent, or 86 cents, to $26.29 in midday trading.

Meanwhile, investors will be seeking signs of progress in Puma SE’s turnaround plans as it attempts to reclaim market share from its rivals with a sharpened focus on its core product line.

The company reported a 25 percent decline in first-quarter profit, which analysts said reflects the challenge CEO Björn Gulden faces in his attempt to revive the company.


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