Breaking Down Caleres, Inc. (CAL) Financial Health: Key Insights for Investors

Is Caleres, Inc. (CAL) a step in the right direction for your investment portfolio, or are there challenges ahead that investors should be aware of? As we dissect the financial health of Caleres, consider these key figures from the fiscal year 2024: net sales reached $2.72 billion, a decrease of 3.4% from 2023, and earnings per share (EPS) stood at $3.30. But with analysts setting price targets between $17 and $25 per share, is the stock currently undervalued, or are there deeper issues at play that might impact future performance? Dive in to uncover the insights that can help you make informed decisions.

Caleres, Inc. (CAL) Revenue Analysis

Understanding Caleres, Inc.'s revenue streams involves examining its diverse sources, growth trends, and segment contributions. A comprehensive look at these elements provides investors with key insights into the company's financial health and strategic direction.

Caleres, Inc. primarily generates revenue through the sale of footwear and accessories. These sales are categorized into different business segments, each contributing uniquely to the company’s overall financial performance. Key aspects of Caleres' revenue streams include:

• Products: The company's revenue is mainly derived from its diverse portfolio of footwear brands, which include both owned and licensed brands.
• Regions: Caleres generates revenue from various geographical regions, including North America, where it has a significant retail and wholesale presence.

Analyzing year-over-year revenue growth rates provides insights into the company's performance trends. Here’s what to consider:

• Historical Trends: Examining past revenue figures helps identify patterns and predict future performance.
• Percentage Increase/Decrease: Calculating the percentage change in revenue from one year to the next indicates the rate at which the company is growing or contracting.

Understanding how different business segments contribute to the overall revenue is crucial. For example:

• Brand Portfolio: Different brands under the Caleres umbrella may experience varying levels of success, impacting their contribution to the total revenue.
• Retail vs. Wholesale: The balance between direct-to-consumer retail sales and wholesale distribution significantly affects revenue composition.

Significant changes in revenue streams can indicate strategic shifts or market dynamics. Investors should be aware of:

• Acquisitions and Divestitures: Changes in revenue may result from the company acquiring or divesting brands or business segments.
• Market Trends: Shifts in consumer preferences and economic conditions can impact the demand for different types of footwear, influencing revenue streams.

To provide a clearer picture, let's consider hypothetical revenue data for Caleres, Inc. across its major segments. Please note that the following figures are examples and do not reflect actual financial results.

This hypothetical data illustrates how each segment contributes to the total revenue and the year-over-year growth rate. Analyzing such data helps investors understand the strengths and weaknesses within Caleres' revenue streams.

For more insights into the company's strategic direction, review Mission Statement, Vision, & Core Values of Caleres, Inc. (CAL).

Caleres, Inc. (CAL) Profitability Metrics

Analyzing Caleres, Inc. (CAL) profitability involves examining several key metrics to understand the company's financial health and operational efficiency. These metrics include gross profit, operating profit, and net profit margins, which provide insights into how effectively the company manages its costs and generates profits from its revenue.

Here's a breakdown of what to consider:

• Gross Profit Margin: This ratio indicates the percentage of revenue remaining after subtracting the cost of goods sold (COGS). A higher gross profit margin suggests that Caleres, Inc. (CAL) is efficient in managing its production costs.
• Operating Profit Margin: This ratio measures the percentage of revenue remaining after deducting both COGS and operating expenses. It reflects the company's efficiency in managing its core business operations.
• Net Profit Margin: This ratio represents the percentage of revenue that translates into net profit after all expenses, including interest and taxes, have been paid. It is a comprehensive measure of the company's overall profitability.

To assess the trends in profitability over time, one can compare these ratios across multiple fiscal years. Increases in these margins typically indicate improved efficiency or pricing strategies, while decreases may signal rising costs or pricing pressures. For instance, comparing the gross profit margin from 2023 to 2024 can reveal whether the company has become more effective in controlling its production costs.

Furthermore, comparing Caleres, Inc. (CAL) profitability ratios with industry averages provides valuable context. If the company's margins are higher than the industry average, it may indicate a competitive advantage. Conversely, lower margins may suggest areas where the company needs to improve its efficiency or cost management.

Operational efficiency is closely tied to profitability. Effective cost management and favorable gross margin trends are crucial for maintaining and improving profitability. For example, if Caleres, Inc. (CAL) can reduce its operating expenses as a percentage of revenue, its operating profit margin will likely increase.

Based on the Caleres, Inc. (CAL) 2024 fiscal year data, here's an overview of their profitability metrics:

Caleres, Inc. (CAL) reported a gross profit of 44.8% of sales for fiscal year 2024. Additionally, the company's operating earnings stood at $127.2 million, and net earnings reached $85.7 million, or $2.46 per diluted share.

For further insights into Caleres, Inc. (CAL) financial health, you can explore: Breaking Down Caleres, Inc. (CAL) Financial Health: Key Insights for Investors

Caleres, Inc. (CAL) Debt vs. Equity Structure

Understanding how Caleres, Inc. (CAL) manages its debt and equity is crucial for assessing its financial strategy and risk profile. This involves examining the company's debt levels, its debt-to-equity ratio, and any recent financing activities.

As of February 2, 2025, Caleres Inc.'s (CAL) balance sheet highlights several key figures regarding its debt:

• Total current liabilities stand at $483.7 million.
• Total long-term debt is reported at $27.4 million.

These figures provide a snapshot of the company's obligations, with current liabilities representing those due within a year and long-term debt reflecting obligations extending beyond a year.

The debt-to-equity ratio is a significant metric for evaluating a company's financial leverage. It indicates the proportion of debt and equity used to finance the company's assets. A lower ratio generally suggests less risk, as the company relies more on equity than debt.

Caleres, Inc. (CAL) reported a debt-to-equity ratio of 0.14 as of February 2, 2025. This ratio is calculated by dividing the total liabilities by the total shareholders equity.

To provide context, it's useful to compare Caleres, Inc. (CAL) debt-to-equity ratio to industry standards. Here is a general framework:

• A ratio below 1.0 is generally considered good, indicating that the company has more equity than debt.
• A ratio between 1.0 and 2.0 is acceptable.
• A ratio of 2.0 or higher may indicate that the company is taking on too much risk.

Given Caleres, Inc. (CAL) ratio of 0.14, the company is conservatively financed, with a strong reliance on equity.

Recent financial activities, such as debt issuances or refinancing, can significantly impact a company's capital structure.

On November 26, 2024, Caleres, Inc. (CAL) announced the redemption of its remaining $50 million outstanding principal amount of its 7.25% Senior Notes due 2025. This move demonstrates proactive debt management and reduces future interest expenses.

Balancing debt and equity is crucial for sustainable growth. Debt can provide leverage and potentially increase returns on equity, but it also introduces financial risk. Equity, on the other hand, provides a stable capital base without the obligation of repayment.

Caleres, Inc. (CAL) appears to be strategically managing its capital structure by maintaining a conservative debt-to-equity ratio and taking advantage of opportunities to reduce debt.

For more insights into Caleres, Inc. (CAL), you might find this resource helpful: Mission Statement, Vision, & Core Values of Caleres, Inc. (CAL).

Caleres, Inc. (CAL) Liquidity and Solvency

Liquidity and solvency are vital indicators of a company's financial health, revealing its ability to meet short-term obligations and long-term debts. For Caleres, Inc. (CAL), analyzing these metrics provides insights into its operational efficiency and financial stability. Here’s a breakdown of Caleres' liquidity position:

Current and Quick Ratios:

The current and quick ratios are essential for evaluating a company's ability to cover its short-term liabilities with its short-term assets. A higher ratio generally indicates better liquidity.

• Current Ratio: Caleres' current ratio stands at 2.3, reflecting a strong capacity to meet its short-term obligations. This ratio is calculated by dividing current assets by current liabilities.
• Quick Ratio: The quick ratio, which excludes inventory from current assets, is 0.8. This more conservative measure still suggests adequate liquidity, although it is lower than the current ratio, indicating that the company relies on inventory to some extent to meet its short-term liabilities.

Analysis of Working Capital Trends:

Working capital, defined as current assets minus current liabilities, is a key indicator of a company's operational liquidity. Monitoring its trends can reveal whether a company is efficiently managing its short-term resources.

• Caleres' working capital has been consistently positive, demonstrating its ability to cover short-term liabilities with current assets.
• Fluctuations in working capital can be attributed to seasonal variations in sales and inventory levels, as well as strategic decisions regarding accounts payable and receivable.

Cash Flow Statements Overview:

An examination of cash flow statements provides a comprehensive view of how Caleres generates and uses cash, categorized into operating, investing, and financing activities.

• Operating Cash Flow: Caleres has demonstrated positive operating cash flow, indicating its core business operations are generating sufficient cash to cover expenses and reinvest in the company.
• Investing Cash Flow: The company’s investing activities include capital expenditures and strategic investments. Recent trends show a balance between investing in growth opportunities and maintaining financial discipline.
• Financing Cash Flow: Caleres' financing activities involve managing debt, equity, and dividends. Recent data indicates a strategic approach to maintaining a healthy capital structure.

Potential Liquidity Concerns or Strengths:

Caleres exhibits several strengths in its liquidity position, supported by healthy current and quick ratios, positive working capital, and robust operating cash flow. However, it is essential to monitor certain factors:

• Inventory Management: The difference between the current and quick ratios suggests that inventory plays a significant role in Caleres' liquidity. Efficient inventory management is crucial to avoid tying up excessive capital.
• Debt Levels: Monitoring debt levels and interest coverage ratios is important to ensure that Caleres can comfortably service its debt obligations, especially in periods of economic uncertainty.

Overall, Caleres, Inc. demonstrates a solid liquidity position, underpinned by strong financial metrics and effective cash flow management. Prudent monitoring of inventory and debt will be essential to sustain this financial health.

Caleres, Inc. (CAL) Valuation Analysis

Determining whether Caleres, Inc. (CAL) is overvalued or undervalued requires a multifaceted approach, incorporating key financial ratios, stock performance analysis, and analyst sentiment. Here's a breakdown of essential valuation metrics:

Price-to-Earnings (P/E) Ratio: The P/E ratio compares Caleres, Inc.'s stock price to its earnings per share (EPS). A lower P/E ratio might suggest undervaluation relative to peers or its historical average, while a higher P/E ratio could indicate overvaluation or high growth expectations. For the fiscal year 2024, investors should compare Caleres, Inc.'s P/E ratio against the industry average and its own historical P/E ratios to gauge its relative valuation.

Price-to-Book (P/B) Ratio: The P/B ratio compares Caleres, Inc.'s market capitalization to its book value of equity. A P/B ratio below 1.0 could suggest that the stock is undervalued, as the market price is lower than the company's net asset value. Conversely, a P/B ratio above 1.0 might indicate overvaluation. This metric is particularly useful for assessing companies with substantial tangible assets.

Enterprise Value-to-EBITDA (EV/EBITDA) Ratio: The EV/EBITDA ratio assesses Caleres, Inc.’s total value (including debt) relative to its earnings before interest, taxes, depreciation, and amortization (EBITDA). A lower EV/EBITDA ratio often implies undervaluation, suggesting that the company's market value is low compared to its operating cash flow. Conversely, a higher ratio may indicate overvaluation.

Stock Price Trends: Analyzing Caleres, Inc.'s stock price trends over the past 12 months, or longer, provides insights into market sentiment and investor confidence. Consistent upward trends may reflect positive market perception, while downward trends could signal concerns about the company's performance or industry outlook. Consider these points:

• 52-Week High and Low: Comparing the current price to its 52-week high and low can indicate potential entry or exit points.
• Historical Performance: Reviewing long-term stock performance helps identify patterns and potential future movements.

Dividend Yield and Payout Ratios: If Caleres, Inc. pays dividends, the dividend yield (annual dividend per share divided by the stock price) indicates the return on investment from dividends alone. The payout ratio (dividends paid as a percentage of earnings) shows the sustainability of dividend payments. A high dividend yield with a sustainable payout ratio can be attractive to income-seeking investors.

Analyst Consensus: Monitoring analyst ratings and price targets provides an external perspective on Caleres, Inc.'s valuation. Consensus ratings such as 'buy,' 'hold,' or 'sell' reflect the overall sentiment of financial analysts covering the stock. Price targets indicate analysts' expectations for the stock's future value. Consider the source and track record of the analysts when evaluating their opinions.

Here's an example of how analyst ratings might be presented:

Keep in mind that this is illustrative and real-time data should be consulted for current assessments.

For further insights into Caleres, Inc.'s financial health, check out: Breaking Down Caleres, Inc. (CAL) Financial Health: Key Insights for Investors

Caleres, Inc. (CAL) Risk Factors

Caleres, Inc. (CAL) faces a variety of internal and external risks that could significantly impact its financial health. These risks span industry competition, regulatory changes, evolving market conditions, and specific operational and strategic challenges detailed in its financial reports.

Here's a breakdown of key risk areas:

• Industry Competition: The footwear industry is highly competitive. Caleres faces competition from established brands, retailers, and emerging online platforms. Maintaining market share requires continuous innovation, effective marketing, and competitive pricing strategies.
• Regulatory Changes: Changes in trade policies, tariffs, and other regulations can significantly impact Caleres' supply chain and cost structure. For example, increased tariffs on imported goods could raise costs and reduce profitability.
• Market Conditions: Economic downturns, shifts in consumer spending, and changing fashion trends can affect demand for Caleres' products. Staying attuned to these market dynamics is crucial for adapting business strategies.

Operational, financial, and strategic risks are often highlighted in Caleres' earnings reports and filings. These may include:

• Supply Chain Disruptions: Dependence on global supply chains makes Caleres vulnerable to disruptions caused by geopolitical events, natural disasters, or other unforeseen circumstances. Diversifying the supply base and implementing robust risk management practices are essential.
• Inventory Management: Balancing inventory levels to meet demand while minimizing obsolescence is a constant challenge. Inefficient inventory management can lead to markdowns and reduced profit margins.
• Brand Reputation: Maintaining a positive brand image is critical for attracting and retaining customers. Negative publicity or product recalls can damage brand reputation and impact sales.

Mitigation strategies and plans to address these risks may include:

• Diversification: Expanding into new markets, product categories, or distribution channels can reduce reliance on any single area and mitigate risk.
• Cost Management: Implementing cost-saving measures and improving operational efficiency can help offset the impact of increased expenses or reduced revenue.
• Innovation: Investing in research and development to create new and innovative products can help maintain a competitive edge and attract customers.
• Risk Management: Developing comprehensive risk management plans and regularly assessing potential threats can help Caleres prepare for and respond to challenges effectively.

For additional insights into Caleres, Inc. (CAL), consider exploring this resource: Exploring Caleres, Inc. (CAL) Investor Profile: Who’s Buying and Why?

Caleres, Inc. (CAL) Growth Opportunities

Caleres, Inc. (CAL) faces a dynamic market environment, necessitating a multifaceted approach to future growth. Key growth drivers include product innovation, strategic market expansions, and potential acquisitions.

Product innovation is central to Caleres, Inc. (CAL)'s growth strategy. The company must continually refresh its product lines to meet evolving consumer preferences and fashion trends. This includes investing in research and development to create new materials, designs, and technologies that differentiate its brands in the marketplace. For example, new comfort technologies or sustainable materials could attract a broader customer base.

Market expansion represents another significant avenue for growth. Caleres, Inc. (CAL) can explore opportunities to increase its presence in both existing and new geographic markets. This could involve opening new retail locations, expanding its e-commerce platform, or partnering with international distributors to reach customers in underserved regions. Successfully entering new markets requires a deep understanding of local consumer preferences and competitive landscapes.

Acquisitions can provide Caleres, Inc. (CAL) with access to new brands, technologies, or markets, accelerating its growth trajectory. By acquiring complementary businesses, Caleres, Inc. (CAL) can expand its portfolio of offerings and strengthen its competitive position. However, successful acquisitions require careful due diligence and integration to ensure that the acquired assets align with the company's overall strategic objectives.

Future revenue growth projections and earnings estimates are subject to various factors, including macroeconomic conditions, consumer spending patterns, and competitive pressures. Financial analysts' estimates provide insights into potential future performance, but these projections are not guarantees. Investors should carefully consider the assumptions underlying these estimates and assess the risks and uncertainties that could affect actual results.

Strategic initiatives and partnerships can play a crucial role in driving future growth. Caleres, Inc. (CAL) may pursue collaborations with other companies to leverage their expertise, resources, or distribution networks. For example, partnerships with social media influencers or collaborations with other apparel brands could help to increase brand awareness and drive sales. These initiatives should align with the company's overall strategic objectives and create mutual value for all parties involved.

Caleres, Inc. (CAL) possesses several competitive advantages that position it for growth. These may include strong brand recognition, a diversified portfolio of brands, a well-established distribution network, and a loyal customer base. By leveraging these strengths, Caleres, Inc. (CAL) can differentiate itself from competitors and capture a greater share of the market. However, it is essential to continuously innovate and adapt to changing market conditions to maintain a competitive edge.

The competitive landscape for Caleres, Inc. (CAL) includes a mix of established players and emerging brands. Competition is based on factors such as product quality, design, price, and marketing effectiveness. To succeed in this environment, Caleres, Inc. (CAL) must continuously monitor its competitors' activities and adapt its strategies accordingly. This includes investing in innovation, strengthening its brand, and optimizing its distribution channels.

Here are some strategic initiatives that may drive future growth:

• Enhancing the e-commerce platform to improve the online shopping experience
• Expanding the company's presence in key international markets
• Investing in marketing and advertising to increase brand awareness
• Developing new products that meet the evolving needs of consumers
• Pursuing strategic acquisitions to expand the company's portfolio of brands

An analysis of the company’s financials, strategies, and market dynamics provides a comprehensive view. Based on the 2024 fiscal year data, here’s a snapshot of key financial metrics:

For more in-depth insights into Caleres, Inc. (CAL) and its investors, check out: Exploring Caleres, Inc. (CAL) Investor Profile: Who’s Buying and Why?