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Crocs (CROX) earnings preview: navigating the choppy waters of the footwear industry

AInvestThursday, Feb 15, 2024 9:21 am ET
1min read

Crocs, Inc. (CROX), a standout in the casual footwear and accessories market, is on the cusp of unveiling its Q4 (December) earnings. This earnings preview aims to sift through the company's latest updates, financials, and industry position to gauge Crocs' investment appeal amid a fluctuating market landscape.

Recent News & Fundamental Factors

After a recent upward revision, Crocs anticipates a slight revenue bump of over 1% year-over-year for Q4, a notable shift from its earlier forecast of a 1-4% decrease. Looking forward, the company eyes a 3-5% revenue uptick for FY24, building on an expected 11% surge for FY23. Crocs also projects year-over-year gross margin growth and non-GAAP operating margins around 25%.

In a sector grappling with dwindling demand, Crocs has adeptly managed its stock levels, setting a positive tone for its latest quarterly projection. This strategic inventory control distinguishes Crocs in a field where peers like Under Armour (UAA) have stumbled, particularly in their footwear segments during their Q3 (December) tallies.

Technical Specifics & Market Data

With a valuation of $6.48 billion and an enterprise worth of $8.64 billion, Crocs presents itself with a forward P/E ratio of 9, starkly lower than the S&P 500's forward P/E of 18.7. Anchored in the Consumer Cyclical sector, which currently stands at a 27.8 P/E ratio based on trailing twelve-month figures, Crocs showcases its competitive edge.

Analysts' Views & Investment Recommendations

Crocs enjoys the confidence of 11 Wall Street analysts, commanding a consensus of a Strong Buy. The company's robust buyback strategy, reactivated last quarter, coupled with optimistic guidance issued in January, hints at a favorable trajectory, especially if it can uphold its value above its 200-day moving average.

Conclusion

As we approach Crocs' Q4 earnings release, the brand emerges as a compelling pick for investors drawn to the footwear industry's potential. Crocs' robust identity, inventory oversight, and growth outlook posit it as an appealing choice. Yet, the broader sector's hurdles warrant attention, suggesting investors stay attuned to upcoming reports and directives to navigate their stakes in Crocs wisely.


Disclaimer: the above is a summary showing certain market information. AInvest is not responsible for any data errors, omissions or other information that may be displayed incorrectly as the data is derived from a third party source. Communications displaying market prices, data and other information available in this post are meant for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any security. Please do your own research when investing. All investments involve risk and the past performance of a security, or financial product does not guarantee future results or returns. Keep in mind that while diversification may help spread risk, it does not assure a profit, or protect against loss in a down market.