Genesco (GCO) Stock Forecast & Price Target

Genesco Inc. has revised its fiscal 2026 outlook positively, projecting total sales growth of 3%-4% and same-store sales growth of 4%-5%, an increase from prior forecasts that were more conservative. The company's management has reported a significant comp lift of approximately 25% in stores, attributed to enhanced customer traffic, improved conversion rates, and larger transaction sizes. Additionally, the Journeys Group continues to demonstrate strong performance, producing a notable 9% comp growth in total enterprise sales, which positions Genesco favorably within the footwear and retail market segment.

Genesco Inc. is experiencing significant pressure on its gross margins, with guidance indicating a contraction of 50 to 70 basis points for the third quarter, which falls below previous market expectations of flat margins year-over-year. Additionally, the company’s outlook for fiscal year 2026 now anticipates a gross margin decline of 50 to 60 basis points, a notable deterioration from earlier projections. Compounding these issues, the footwear segment, particularly the Schuh Group, faces adverse impacts from declining consumer traffic and promotional challenges in the UK, alongside broader trends of weakening consumer spending due to macroeconomic factors.