It’s been a wild ride for retail stocks this year.
From the ongoing COVID-19 global health crisis to the election of a new United States president, major fashion and footwear players have seen drastic changes that are expected to change the face of the industry in the year ahead as well as the long term.
Some brands and retailers have been forced to reckon with the impact of the pandemic on their balance sheets, leading them to file for Chapter 11 protection, permanently shut down hundreds of stores or attempt companywide restructuring in an effort to preserve liquidity. Others, however, have appeared to gain even more momentum; investors watched as their quarterly earnings reports trumped expectations and shares subsequently surged double digits.
Here, as the year comes to a close, FN rounds up some of the shoe industry’s top stock performers of 2020.
Capri Holdings Ltd.
Year-to-date gain: 10.01%
Financial results: For the second quarter ended Sept. 26, the New York-based company posted adjusted profits of $137 million, or 90 cents per diluted share, compared to $177 million, or $1.16 per diluted share, in the prior year. Still, it soundly trounced Wall Street’s expectations of earnings of 4 cents per share. Revenues also declined 23% to $1.1 billion but trumped analysts’ forecasts of $924.91 million.
Executive commentary: “Our performance demonstrates the power and desirability of the Versace, Jimmy Choo and Michael Kors brands,” chairman and CEO John Idol said. “Through creativity and innovation, our luxury houses inspire excitement and passion, creating an emotional connection with our consumers. We are also attracting new consumers to each of our luxury houses as evidenced by the double-digit increase in our consumer databases.”
Year-to-date gain: 50.73%
Financial results: The clog maker, which was honored as Brand of the Year at FN’s first virtual FN Achievement Awards, logged adjusted earnings of 94 cents per share for the third quarter, while last year’s EPS amounted to 57 cents. Market watchers had been anticipating earnings of 69 cents. Revenues for the period ended Sept. 30 increased 15.7% to $361.7 million, versus consensus bets of $339.6 million.
Executive commentary: “We achieved record third-quarter revenue and EPS despite the challenges presented by the global COVID-19 pandemic,” CEO Andrew Rees said. “Our extraordinary performance and strong cash flow generation demonstrates the strength of the Crocs brand and product offering globally. I am tremendously proud of how we have executed as a team and am excited for our future.”
Deckers Outdoor Corp.
Year-to-date gain: 67.29%
Financial results: For the three months ended Sept. 30, the Goleta, Calif.-based corporation — awarded Company of the Year at the 2020 FNAAs — reported earnings of $3.58 per share, versus the prior year’s earnings of $2.71 per share and better than analysts’ predictions of earnings of $2.63 per share. Revenues also improved 15% to $623.5 million, compared with Wall Street’s forecasts of $553.62 million.
Executive commentary: “Deckers’ record second-quarter performance was the result of our powerful brands, dedicated teams, innovative product launches and ability to capture demand online,” president and CEO Dave Powers said. “We are thrilled by the resilience of our organization to deliver strong results in the first half of fiscal year 2021.”
Foot Locker Inc.
Year-to-date gain: 6.88%
Financial results: The specialty athletic chain earned $128 million, or $1.21 per share, in the three months ended Oct. 31, compared with the prior year’s profits of $122 million, or $1.13 per share. Market watchers had anticipated earnings per share of 62 cents. Third-quarter revenues, which rose 9% to $2.11 billion, soundly beat estimates of $1.94 billion.
Executive commentary: “We delivered a strong top- and bottom-line performance in the third quarter, underscoring the strength of our in-store and online product assortments and the resilience of the Foot Locker Inc. brands,” chairman and CEO Richard Johnson said. “Although the back-to-school selling season kicked in later than usual due to COVID-19-related delays, momentum built as the quarter progressed, and we were pleased with our customers’ continued strong engagement across our family of brands.”
Year-to-date gain: 38.19%
Financial results: The second quarter saw earnings of 78 cents per share for the athletic apparel and footwear behemoth, versus the prior year’s EPS of 70 cents. Revenues for the three months ended Nov. 30 climbed 9% to $11.2 billion. The numbers crushed Wall Street’s bets of 62 cents in earnings per share and revenues of $10.56 billion.
Executive commentary: “Nike’s strong results during a dynamic environment show the power of staying on the offense,” president and CEO John Donahoe said. “Fueled by compelling innovative product and global brand momentum, we continue to extend our leadership. Our strategy is working, and we are excited for what’s ahead.”
Shoe Carnival Inc.
Year-to-date gain: 6.22%
Financial results: For the three months ended Oct. 31, the Evansville, Ind.-based company logged profits of $14.7 million, or earnings of $1.03 per share, compared with the prior year’s income of $13.7 million, or 94 cents in EPS. Analysts had forecast earnings of 70 cents per share. On the other hand, revenues for the third quarter were flat at $274.6 million — slightly down from market watchers’ estimates of $275.6 million.
Executive commentary: “We achieved same-store sales growth and delivered the most profitable quarter in Shoe Carnival’s history despite the extended back-to-school season,” vice chairman and CEO Cliff Sifford said. “This would not have been possible without the hard work of our Shoe Carnival team members, our incredibly solid vendor partnerships and dedicated customers.”
Year-to-date gain: 16.15%
Financial results: The parent company of Coach, Kate Spade and Stuart Weitzman posted first-quarter adjusted earnings of 58 cents on profits of $161 million, compared with the previous year’s earnings of 40 cents on profits of $114 million. Wall Street had expected earnings of just 23 cents. Revenues for the period ended Sept. 26 declined 14% to $1.17 billion but still topped forecasts of $1.07 billion.
Executive commentary: “We delivered strong profit growth across our portfolio of brands in the face of an unprecedented and challenging backdrop. We drove a meaningful sequential improvement in top-line trends, supported by strength in digital and China,” CEO Joanne Crevoiserat said. “Our performance underscores the power of our brands, the agility of our talented teams and the competitive advantage of Tapestry’s enabling platform.”