Genesco (GCO) Stock Forecast & Price Target

Genesco Inc. has provided an optimistic fiscal year 2026 outlook, projecting total sales growth of 3%-4%, a notable increase from an earlier forecast of 1%-2%, and comparable store sales (comps) expected to rise by 4%-5%, up from 2%-3%. The company's management expressed satisfaction with recent performance, citing approximately a 25% lift in same-store sales driven by enhanced customer traffic, conversion rates, and transaction sizes. Additionally, the Journeys segment continues to show strong momentum with impressive quarterly revenue figures, reporting a 9% increase in comps alongside total enterprise growth of 4% year-over-year.

Genesco Inc. is experiencing significant challenges, as indicated by projected gross margin (GM) contractions of 50 to 70 basis points in 3Q, which falls short of previous expectations for flat GMs year-over-year. Additionally, the company's guidance for FY26 suggests a worsening outlook, with anticipated GMs declining by 50 to 60 basis points compared to earlier forecasts of a 20 to 30 basis point decline. Further compounding these issues, the Schuh Group is facing industry-wide headwinds in the UK, characterized by reduced consumer traffic and spending influenced by broader macroeconomic weaknesses and rising prices.