What drove WWW's EPS growth in Q2 2024?

Wolverine World Wide's (WWW) EPS growth in Q2 2024 can be attributed to several key factors: 1. **Inventory Reduction and Cost Streamlining**: The company anticipated a further reduction of $85 million in inventory by the end of the year, which is a strategic move to improve cash flow and profitability. Lower inventory levels can reduce storage costs and obsolescence, potentially leading to higher gross margins. 2. **Improved Gross Margin**: Wolverine expects an improvement of 460 basis points in the adjusted gross margin for 2024, reaching 44.5%. This projection indicates a strong focus on profitability within the company's operations. Higher gross margins can contribute significantly to EPS growth when combined with stable or increasing revenues. 3. **Merrell Brand Revenues Growth**: The Merrell brand saw a 1.4% year-over-year revenue increase, which is a positive indicator for the company's performance. While this increase might seem modest, it can have a significant impact on EPS when combined with other brands' revenues and overall cost management. 4. **Analyst Confidence and Market Position**: Analysts have shown positive sentiment towards Wolverine, reflected in upward revisions of the Zacks Consensus Estimate for EPS. This confidence can attract more investors, potentially increasing the stock's valuation and supporting EPS growth through increased capital efficiency. In conclusion, WWW's EPS growth in Q2 2024 is likely a result of a combination of inventory reduction, improved gross margin, growth in key brands like Merrell, and positive analyst sentiment. These factors, either directly or indirectly, contribute to the company's profitability and earnings per share.