When I first heard Brown Shoe
But not so with Brown Shoe. While the company's athletic footwear sales were somewhat weak relative to the non-athletic categories, the company put together a very solid third quarter.
Sales rose 20%, with about two-thirds of that growth seemingly having come from the inclusion of the Bennett Footwear business, which Brown Shoe acquired this year. Sales at Famous Footwear were up more than 5% (with positive comps of better than 2%), while specialty sales rose 16%, and as-reported wholesale sales climbed more than 52% (again boosted by Bennett).
Though margins were softer in this quarter, the company incurred more than $3 million in after-tax costs pertaining to its efforts (principally store-closing expenses) to restructure the Naturalizer business. Net income was still up over last year when these charges are included, and stripping them out suggests bottom-line growth of better than 20%.
Backing up the notion that things are getting better, operating and free cash flow are both much stronger on a comparative basis with last year. Inventories appear to be well under control, and the company saw good growth in its wholesale backlog.
Management has done all right here over the years, and the stock certainly reflects that. The biggest lingering issue in my mind is that the shares look fairly valued. Paying fair value for a stock like Nike
Slip into some more Foolish footwear fribbles:
Deckers Outdoor is a Motley Fool Hidden Gems recommendation.
Fool contributor Stephen Simpson has no financial interest in any stocks mentioned (that means he's neither long nor short the shares).