What Happened?

Shares of footwear company Caleres (NYSE: CAL) fell 12% in the morning session after the company reported disappointing second-quarter 2025 results and missed Wall Street's profit estimates. 

The company posted adjusted earnings of $0.35 per share, a 59% drop from the prior year and significantly below analysts' expectations of $0.56. While revenue of $658.5 million met expectations, it still represented a 3.6% decline year-over-year. Profitability was a key concern as the company's operating margin contracted sharply to 1.4% from 6.3% in the same period last year. The significant earnings miss and shrinking margins prompted a negative reaction from investors.

The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Caleres? Access our full analysis report here, it’s free.

What Is The Market Telling Us

Caleres’s shares are extremely volatile and have had 33 moves greater than 5% over the last year. But moves this big are rare even for Caleres and indicate this news significantly impacted the market’s perception of the business.

The previous big move we wrote about was 8 days ago when the stock gained 3.1% on the news that peer company Kohl's reported strong second-quarter earnings. The footwear company's stock appears to be benefiting from broader optimism following the department store chain's impressive results. Kohl's (KSS) reported earnings per share of $0.56, significantly beating analysts' estimates of $0.29. The company also raised its full-year earnings forecast, signaling momentum in its strategy and suggesting healthy consumer spending. This positive news sent Kohl's shares surging nearly 20% and fueled investor confidence that other retailers, including Caleres, could see similar strength. The overall market backdrop was also favorable for the sector, with the Consumer Discretionary Select Sector SPDR (XLY) trading higher during the session.

Caleres is down 38.7% since the beginning of the year, and at $13.78 per share, it is trading 65.3% below its 52-week high of $39.76 from September 2024. Investors who bought $1,000 worth of Caleres’s shares 5 years ago would now be looking at an investment worth $1,398.

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