Steve Madden Ltd Falls 8%, Wunderlich Lowers Price Target

Wunderlich Securities lowered its price target on Steve Madden, Ltd. SHOO from $43 to $39 in a report issued Monday.  The firm reiterated its Buy rating.

Analyst Danielle McCoy lowered “FY14 and FY15 estimates to $1.83 (from $2.04) and $2.16 (from $2.42), respectively, after Steven Madden (SHOO) pre-announced weaker than expected 3Q results and became even more conservative in its FY14 outlook, reducing annual top- and bottom-line guidance.”

McCoy believed “Steve Madden's diversified model remains in tact and that management is taking the necessary precautions to best battle the weak retail environment while at the same time positioning the business for long-term growth. Our revised price target of $39 maintains our previous valuation of 16x forward EPS.”

The report concluded that peers are “currently trading 12.5x forward EPS vs. SHOO at 11x, and are currently being valued at a premium to SHOO due to greater growth rates off of lower bases. That said, SHOO is an attractive long-term story with a solid operating platform, ample cash balance and multiple global growth opportunities on tap.”

Steve Madden, Ltd. recently traded at $29.24, down 8.45 percent.