The crisis that beset the world earlier this year created some valuation dislocations in many sectors of the stock market. One was certainly retail, as stocks in the group performed wildly differently throughout the initial stages of panic, and subsequently. One stock that was sold far too heavily – and remains unappreciated to this day, in my view – is Shoe Carnival (SCVL).
The stock made a new 2020 high about a month ago but was rudely rebuffed from that level, and trades today about six dollars lower. That’s a very sizable pullback and in my view, Shoe Carnival is back into the value category as of this point.
The apparel retailers index has underperformed this year, but has turned higher in recent weeks. Shoe Carnival has outperformed its benchmark for the year, so if the group does continue to run higher against the S&P 500, Shoe Carnival