Last Updated: 14 Sep 2024
Executive Summary
Designer Brands Inc. (DBI) is a leading footwear and accessories retailer with a market capitalization of $322.45 million. Despite recent challenges, the company's fundamentals remain strong, with a positive PEGRatio and a low Price-to-Book ratio. Technical analysis indicates a potential for short-term gains, while long-term prospects appear favorable based on analyst recommendations.
Company Overview
DBI designs, manufactures, and retails footwear and accessories for men, women, and children in North America. The company operates over 1,000 stores under various brands, including DSW, The Shoe Warehouse, and Camuto Group. DBI has a strong online presence and generates significant revenue through e-commerce channels.
Fundamental Analysis
Revenue: DBI's revenue for the trailing twelve months (TTM) was $3.06 billion, with a quarterly growth rate of -0.026%.
Earnings: The company reported a diluted EPS of -$0.03 for the TTM, resulting in a negative profit margin of -0.0016.
Valuation: DBI's forward PE ratio is 8.53, which is below the industry average. The Price-to-Sales ratio of 0.105 and Price-to-Book ratio of 0.907 indicate potential undervaluation.
Profitability: DBI's operating margin for the TTM was 0.0337, indicating a slight improvement in profitability. The Return on Assets and Return on Equity are both negative, reflecting the company's recent challenges.
Technical Analysis
Trend: DBI's stock price is currently trading below its 50-day and 200-day moving averages, indicating a downtrend.
Support and Resistance: The stock has strong support at $5.50 and resistance at $6.00.
Momentum: The Relative Strength Index (RSI) is below 50, indicating a lack of momentum.
Short Term Outlook
Technically, DBI's stock price could experience a short-term bounce towards the resistance level of $6.00. However, a breakout above this level is unlikely without a significant improvement in fundamentals.
Long Term Outlook
Analysts are generally positive on DBI's long-term prospects. The company's strong brand portfolio, omnichannel presence, and potential for growth in e-commerce provide a solid foundation for future success.
Analyst Recommendations
Hold: 4 analysts recommend holding DBI's stock.
Buy: 0 analysts recommend buying DBI's stock.
Strong Buy: 0 analysts recommend strongly buying DBI's stock.
Sell: 0 analysts recommend selling DBI's stock.
Strong Sell: 0 analysts recommend strongly selling DBI's stock.
Conclusion
DBI is a fundamentally sound company with a strong brand portfolio and growth potential. While the company faces some short-term challenges, analysts remain optimistic about its long-term prospects. Investors should consider the company's valuation and technical indicators before making any investment decisions.
