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Shares of Skechers USA, Inc. (SKX - Analyst Report) touched a new 52-week high of $23.44 yesterday, before closing at $23.38, and rising approximately 29% year to date.

Based on the current price, Skechers is 7.2% below the Zacks Consensus average analyst price target of $25.20, signifying further upside potential. Moreover, it currently trades at a forward P/E of 24.7x, a 39.6% premium to the peer group average of 17.7x.

Rise in the share price comes on the back of the company’s strong first-quarter 2013 earnings and management’s belief of sustaining its growth momentum in 2013. The company delivered quarterly earnings of 13 cents a share that marked a significant improvement from the loss of 7 cents witnessed in the year-ago quarter.

Growth across domestic wholesale, international, company-operated retail businesses and e-Commerce operations boosted the company’s financials. Moreover, this Zacks Rank #3 (Hold) company registered a 28.6% rise in total sales to $451.6 million.

We believe that with more emphasis on the new line of products, cost containment efforts, inventory management and global distribution platform, Skechers remains well positioned to generate growth.

Skechers anticipates to register significant growth in the third quarter in comparison to the second quarter due to early Easter on Mar 31 this year, and back-to-school deliveries going into the third quarter of 2013.

Management remains committed to opening additional Skechers stores and increasing distribution channels with the development of international distribution agreements to boost its sales and profitability. Moreover, international business remains a significant growth driver for the company’s sales. Skechers, through its distribution networks, subsidiaries and joint ventures, is poised to enhance its global reach in the footwear market.

Other Stocks to Consider

Until any further upgrade in Skechers’ Zacks Rank, other stocks worth considering in the consumer discretionary sector include Big 5 Sporting Goods Corp. (BGFV - Analyst Report) and Brown Shoe Co. Inc. (BWS - Snapshot Report), both of which carry a Zacks Rank #1 (Strong Buy). Carter's, Inc. (CRI - Snapshot Report), carrying a Zacks Rank #2 (Buy) is also worth considering.

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