May 4, 2010 / 4:17 PM / 8 years ago

UPDATE 2-Steven Madden Q1 results top market

* Q1 EPS $0.55 vs est $0.38

* Revenue up 23 pct at $131.6 mln vs est $125.1 mln

* Raises FY outlook

* Analyst says outlook conservative

* Shares fall 8 pct (Adds details, analyst comments, updates stock activity)

By Shobhana Chadha

BANGALORE, May 4 (Reuters) - Steven Madden Ltd’s (SHOO.O) first-quarter earnings blew past Wall Street estimates as the shoemaker saw strong sales at its wholesale division and significant margin gains at its retail segment.

However, its shares sank 8 percent Tuesday, which an analyst attributed to the company’s conservative outlook. The stock had gained more than 50 percent over the past three months to a year-high on Monday.

Analyst Samuel Poser of Sterne Agee said Steven Madden’s outlook was “good but not great” and hence fell short of expectations, and the hype that got created around the stock in the last couple of days could not be sustained.

“A lot of new money that went into the stock is now coming out. But this should turn around again as what they (Steven Madden) are doing is very strong from all aspects,” he said.

The company raised its fiscal 2010 earnings forecast to between $2.30 and $2.40 per share. It had earlier forecast earnings of $2.07 to $2.20 a share. Both forecasts adjust for a 3-for-2 stock split.

For the full-year period, Steven Madden now sees revenue growth of 17 percent to 19 percent, up from its prior view of an 11 percent to 13 percent increase.

Based on 2009 revenue of $503.6 million, this implies full-year revenue of $589.2 million to $599.3 million.

    Analysts on average were expecting the company to earn $2.19 on an adjusted basis for the year, on revenue of $567.4 million, according to Thomson Reuters I/B/E/S.

    For the first quarter ended March 31, the Long Island City, New York-based company said net income was $15.4 million, or 55 cents a share, compared with $6.6 million, or 24 cents a share, a year ago.

    Revenue rose 23 percent to $131.6 million.

    Analysts on average expected earnings of 38 cents per share, on revenue of $125.1 million.

    Retail gross margins expanded about 9 percentage points to 56.7 percent due to reduced discounting, the maker of Candies, Stevies and Steve Madden shoes and accessories said.

    Net sales for the wholesale business rose 28 percent to $103.1 million, driven by strong gains from existing wholesale footwear divisions, contribution from new license for Elizabeth and James brand and recent acquisitions of Madden Zone and Big Buddha.

    Shares of company were down about 8 percent at $37.05 in midday trade Tuesday on Nasdaq. (Reporting by Shobhana Chadha; Editing by Anne Pallivathuckal and Gopakumar Warrier)

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