Jefferies’ equity analyst Randal J. Konik has maintained his “Hold” rating on Caleres, following its $255 million purchase of Allen Edmonds on Tuesday.

“We are encouraged by the announcement as it represents added growth prospects for [Caleres’] brand portfolio and the potential for incremental market share gains in men’s footwear,” Konik said.

Caleres has a portfolio of footwear brands that include Naturalizer, Sam Edelman, Franco Sarto, LifeStride, Via Spiga and Dr. Scholl’s Shoes.

Allen Edmonds, founded in 1922, is known for its men’s premium handcrafted leather footwear, apparel and accessories. It was acquired in 2013 by private equity firm Brentwood Associates for $200 million, and under Brentwood’s ownership grew stores and a deeper e-commerce penetration.

Even though shares of Caleres are trading around $35 a share, Konik kept his rating and price target at $27 a share.

“We believe Caleres is poised to benefit from the ongoing strong footwear cycle and acknowledged initiatives to expand gross margin and control inventory, but we remain on the sidelines until there is a greater visibility in the brand portfolio business following recent choppy top-line performance,” Konik said.

Caleres said the transaction would be funded through existing cash and borrowings under its revolving credit line.