Shares of Weyco Group, Inc. WEYS have gained 6.9% since the company reported results for the quarter ended March 31, 2026, outperforming the S&P 500 index’s 2.9% rise over the same period. However, over the past month, the stock has declined 1.6%, lagging the S&P 500’s 8.6% increase.
Weyco reported first-quarter 2026 earnings per share of 64 cents, which increased from 57 cents in the prior-year quarter.
Net sales of $68 million remained essentially flat from the year-ago quarter.
Despite stagnant revenues, profitability improved, aided by lower expenses. Earnings from operations increased 7% year over year to $7.5 million from $7 million, while net earnings rose 10% to $6.1 million from $5.5 million. Gross margin narrowed to 44.2% from 44.6% due to tariff-related cost pressures.
Weyco Group, Inc. Price, Consensus and EPS Surprise
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Segment Performance Reflects Mixed Demand Trends
Weyco’s North American wholesale segment generated net sales of $53.6 million, down 1% year over year. Performance varied across brands. Florsheim sales increased 5%, benefiting from continued strength in the dress shoe category, while Stacy Adams and BOGS sales declined 9% and 11%, respectively, because of softer retailer demand. Nunn Bush sales were unchanged from the prior year. Wholesale operating earnings rose 5% to $7 million as lower selling and administrative expenses offset weaker margins.
Retail segment sales rose 2% to $8.8 million, supported by stronger e-commerce demand, particularly for Florsheim products. Retail operating earnings improved to $0.8 million from $0.6 million in the prior-year quarter. Meanwhile, Florsheim Australia sales increased 10% to $5.6 million, largely due to favorable currency movements, though sales in local currency were flat. The business recorded an operating loss of $0.2 million, unchanged from the prior year.
Tariffs Continue to Pressure Margins
Management said incremental tariffs remained a major headwind during the quarter. The company disclosed that it paid approximately $19.8 million in tariffs during 2025 and the first quarter of 2026, with the tariffs increasing product costs by 19% to 50%. Although price increases implemented in the second half of 2025 helped offset some of the pressure, gross margins remained compressed.
CEO Thomas Florsheim Jr. noted that Weyco raised prices by 10% last July, which partially mitigated the impact of the tariffs. He added that margins improved somewhat under the current 10% tariff framework, though they remained below historical levels. Management also highlighted cleaner inventory positions across several brands, which supported wholesale and retail margins.
The company’s inventory position improved significantly during the quarter. Inventories declined to $50.5 million as of March 31, 2026, from $65.9 million at the end of 2025. Management attributed the decline primarily to timing factors and inventory cleanup efforts.
Management Commentary Highlights Market Uncertainty
Executives described the broader operating environment as uncertain, particularly for discretionary footwear categories. Florsheim continued gaining market share in dress footwear, while Stacy Adams remained under pressure as retailers reduced investments in fashion dress shoes. Management said the brand is shifting toward more casual offerings aligned with changing consumer preferences.
BOGS also faced challenges during the quarter, though management expressed optimism about the second half of 2026 as colder winter weather helped clear excess inventory. The company also pointed to encouraging early demand for new spring footwear products and a revamped marketing strategy focused on authenticity and product storytelling.
Weyco emphasized expense management as another driver of earnings growth. Selling and administrative expenses declined year over year due mainly to lower employee-related costs, including lower benefit expenses and improved operational efficiency in distribution operations. Management stated that headcount reductions did not contribute to the savings.
Financial Update
The company ended the quarter with $93.9 million in cash and marketable securities and no outstanding debt on its revolving credit facility.
Guidance
Weyco estimated 2026 capital expenditures between $2 million and $3 million.
Other Developments
In April 2026, Weyco submitted claims totaling $18.6 million for potential refunds of tariffs previously paid under the International Emergency Economic Powers Act after the U.S. Supreme Court ruled the tariffs invalid. An additional $1.2 million in claims remains pending future filing phases. The company said the timing and amount of any recovery remain uncertain.
The board also approved a quarterly cash dividend of 28 cents per share, payable June 30, 2026, representing a 4% increase from the prior dividend rate of 27 cents per share.
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