We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Reasons Why Crocs (CROX) Should be in Your Portfolio Now
Read MoreHide Full Article
Crocs, Inc. (CROX - Free Report) is well poised for growth courtesy of growth in consumer demand for new clogs and sandals, continued momentum in the Crocs and HEYDUDE brands and strong direct-to-consumer (“DTC”) sales. The company’s focus on comfortable offerings has resonated with consumers, driving brand expansion and attracting customers to its products.
This Zacks Rank #2 (Buy) company has a market capitalization of $6.2 billion. Over the past year, it surged by 38.8% compared with the industry’s increase of 2.2%.
Image Source: Zacks Investment Research
Let’s delve into the factors that have been aiding this stock for a while now.
Business Strength: Crocs came up with impressive second-quarter 2023 results, wherein the top and bottom lines grew year-over-year. In the quarter, the company’s revenues increased by 11.2% year over year to $1,072.4 million, driven by growth across all regions and channels. The Crocs brand’s revenues grew 13.8% year over year to $833 million, including a 25.3% increase in DTC revenues and a 3.8% rise in wholesale revenues.
Acquisition Benefits: The company’s acquisition of HEYDUDE (in February 2022) has been augmenting its fast-growing footwear business. With the addition of HEYDUDE’s consumer-insight-driven casual, comfortable and lightweight product offerings, Crocs has strengthened and expanded its product portfolio. The acquisition has added to the company’s digital penetration, as HEYDUDE already has a strong online presence.
It is worth noting that in the second quarter, HEYDUDE’s revenues advanced 3% year over year to $239.4 million. For 2023, the company expects revenues from the HEYDUDE brand to grow in the range of 14%-18% on a reported basis. Management also remains optimistic about HEYDUDE, which is likely to achieve its sales target of $1 billion this year.
Raised Outlook: CROX raised its guidance for 2023, driven by solid momentum in its business. For the year, it anticipates revenues to grow 12.5-14.5% (from the previously projected 11-14%) to $4,000-$4,065 million. Adjusted earnings are now anticipated in the range of $11.83-$12.22 per share compared with the previous guidance of $11.17-$11.73. The adjusted operating margin is projected to be 27.5%, higher than 26-27%, projected earlier.
For third-quarter 2023, Crocs expects to generate revenues of $1,013-$1,034 million, indicating year-over-year growth of 3-5%. Adjusted earnings are envisioned in the range of $3.07-$3.15 per share, with an adjusted operating margin of 27%.
Financial Flexibility: Crocs has been focusing on reducing debt for a while now. As of Jun 30, 2023, it had long-term borrowings of $2,007.5 million, down 10.8% on a sequential basis. Crocs resumed its share repurchase program with $50 million of share buybacks in July.
Other Stocks to Consider
Here we have highlighted three other top-ranked stocks from the same space.
ANF has a trailing four-quarter earnings surprise of 724.8%, on average. The Zacks Consensus Estimate for Abercrombie & Fitch’s current financial-year sales suggests growth of 10.1% from the year-ago reported figure.
Alto Ingredients (ALTO - Free Report) , a producer of specialty alcohols and essential ingredients, has a Zacks Rank #2 at present.
ALTO delivered an earnings surprise of 242.9% in the last reported quarter. The Zacks Consensus Estimate for ALTO’s upcoming quarter’s EPS indicates growth of 125% from the previous year’s reported figure.
American Eagle Outfitters (AEO - Free Report) , a retailer of casual apparel, accessories and footwear, currently carries a Zacks Rank #2. AEO delivered an average earnings surprise of 9.2% in the last four quarters.
The Zacks Consensus Estimate for American Eagle Outfitters’ current financial-year EPS indicates a jump of 8.3% from the year-ago reported figure.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Reasons Why Crocs (CROX) Should be in Your Portfolio Now
Crocs, Inc. (CROX - Free Report) is well poised for growth courtesy of growth in consumer demand for new clogs and sandals, continued momentum in the Crocs and HEYDUDE brands and strong direct-to-consumer (“DTC”) sales. The company’s focus on comfortable offerings has resonated with consumers, driving brand expansion and attracting customers to its products.
This Zacks Rank #2 (Buy) company has a market capitalization of $6.2 billion. Over the past year, it surged by 38.8% compared with the industry’s increase of 2.2%.
Image Source: Zacks Investment Research
Let’s delve into the factors that have been aiding this stock for a while now.
Business Strength: Crocs came up with impressive second-quarter 2023 results, wherein the top and bottom lines grew year-over-year. In the quarter, the company’s revenues increased by 11.2% year over year to $1,072.4 million, driven by growth across all regions and channels. The Crocs brand’s revenues grew 13.8% year over year to $833 million, including a 25.3% increase in DTC revenues and a 3.8% rise in wholesale revenues.
Acquisition Benefits: The company’s acquisition of HEYDUDE (in February 2022) has been augmenting its fast-growing footwear business. With the addition of HEYDUDE’s consumer-insight-driven casual, comfortable and lightweight product offerings, Crocs has strengthened and expanded its product portfolio. The acquisition has added to the company’s digital penetration, as HEYDUDE already has a strong online presence.
It is worth noting that in the second quarter, HEYDUDE’s revenues advanced 3% year over year to $239.4 million. For 2023, the company expects revenues from the HEYDUDE brand to grow in the range of 14%-18% on a reported basis. Management also remains optimistic about HEYDUDE, which is likely to achieve its sales target of $1 billion this year.
Raised Outlook: CROX raised its guidance for 2023, driven by solid momentum in its business. For the year, it anticipates revenues to grow 12.5-14.5% (from the previously projected 11-14%) to $4,000-$4,065 million. Adjusted earnings are now anticipated in the range of $11.83-$12.22 per share compared with the previous guidance of $11.17-$11.73. The adjusted operating margin is projected to be 27.5%, higher than 26-27%, projected earlier.
For third-quarter 2023, Crocs expects to generate revenues of $1,013-$1,034 million, indicating year-over-year growth of 3-5%. Adjusted earnings are envisioned in the range of $3.07-$3.15 per share, with an adjusted operating margin of 27%.
Financial Flexibility: Crocs has been focusing on reducing debt for a while now. As of Jun 30, 2023, it had long-term borrowings of $2,007.5 million, down 10.8% on a sequential basis. Crocs resumed its share repurchase program with $50 million of share buybacks in July.
Other Stocks to Consider
Here we have highlighted three other top-ranked stocks from the same space.
Abercrombie & Fitch (ANF - Free Report) , a specialty retailer, currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
ANF has a trailing four-quarter earnings surprise of 724.8%, on average. The Zacks Consensus Estimate for Abercrombie & Fitch’s current financial-year sales suggests growth of 10.1% from the year-ago reported figure.
Alto Ingredients (ALTO - Free Report) , a producer of specialty alcohols and essential ingredients, has a Zacks Rank #2 at present.
ALTO delivered an earnings surprise of 242.9% in the last reported quarter. The Zacks Consensus Estimate for ALTO’s upcoming quarter’s EPS indicates growth of 125% from the previous year’s reported figure.
American Eagle Outfitters (AEO - Free Report) , a retailer of casual apparel, accessories and footwear, currently carries a Zacks Rank #2. AEO delivered an average earnings surprise of 9.2% in the last four quarters.
The Zacks Consensus Estimate for American Eagle Outfitters’ current financial-year EPS indicates a jump of 8.3% from the year-ago reported figure.