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Crocs (CROX - Free Report) has been an extremely strong stock over the last five years and it has put on a stellar performance since the market lows in October 2022. Even more encouraging is that CROX’s earnings expectations have been continually revised higher by analysts, helping it capture a Zacks Rank #1 (Strong Buy).
Earnings Expectations
Analysts are in unanimous agreement in upgrading Crocs’ earnings expectations, and current year earnings have been revised higher by nearly 7% over the last 90 days. Additionally, in Q4 Crocs beat analyst expectations on both the top and bottom line and has now topped earnings estimates for 11 straight quarters.
Current quarter sales are expected to climb 29% YoY to $853 million, while full year sales are projected to grow 12.5% to $4 billion. Current quarter earnings, which have been revised higher by 10% over the last 90 days are expected to grow 6.4% YoY to $2.18 per share, and next year earnings are projected to grow 12% to $12.55 per share.
Image Source: Zacks Investment Research
Brand
Crocs is one of the most popular footwear brands in the world. It is famous for its iconic clog made with extremely light and comfortable materials. The company offers a wide variety of footwear products including sandals, wedges, flip-flops, and slides that cater to people of all ages. Crocs’ products are available in more than 80 countries and are distributed via wholesale, retail, and e-commerce platforms.
Booming E-commerce Growth
Crocs has made significant progress on building out its e-commerce and omnichannel sales capabilities, with its internet sales helping really boost growth. Crocs has maintained its focus on brand strength by increasing its social media efforts with strategic collaborations, and influencer campaigns. CROX has also improved customer experience through its Crocs mobile app.
Digital sales advanced 80% year over year in Q4 and represented 45.1% of total revenues, up from last year’s Q4 figure of 40.3%.
Opportunities Abroad
While domestic sales growth was just 0.3%, Asia Pacific and EMEA regions saw booming progress. Asia Pacific experienced 59% YoY sales growth, while EMEA grew 60%. These two segments now make up 13% and 15% of total sales respectively.
In the Asia Pacific region, where the climate is considerably hotter, and per capita income lower, you must imagine Crocs products will be a natural fit for consumers with many years of adoption ahead.
Reasonable Valuation
Even after the phenomenal growth of the last few years CROX is still trading at a reasonable valuation. At 11x one-year forward earnings, it is well below its three-year median of 19x, and the industry average 14x.
Image Source: Zacks Investment Research
Technical Setup
Another bullish catalyst for Crocs is this compelling technical chart pattern. Since the October low, CROX stock has been stair-stepping its way higher, consolidating and breaking out every couple months. Now, the price action has carved out a third consolidation, which should propel the stock considerably higher. The breakout will be confirmed if price can trade above $130. Alternatively, below $110 and the chart pattern is invalid.
Image Source: TradingView
Bottom Line
Crocs has become an iconic brand whose products are recognized around the world. Even still, the company seems to have many years of future growth to look forward to. With its well-rounded product line, digital-first focus, growing international adoption, and improving earnings outlook, Crocs should be on the top of your list of stocks to buy.
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Bull of the Day: Crocs (CROX)
Crocs (CROX - Free Report) has been an extremely strong stock over the last five years and it has put on a stellar performance since the market lows in October 2022. Even more encouraging is that CROX’s earnings expectations have been continually revised higher by analysts, helping it capture a Zacks Rank #1 (Strong Buy).
Earnings Expectations
Analysts are in unanimous agreement in upgrading Crocs’ earnings expectations, and current year earnings have been revised higher by nearly 7% over the last 90 days. Additionally, in Q4 Crocs beat analyst expectations on both the top and bottom line and has now topped earnings estimates for 11 straight quarters.
Current quarter sales are expected to climb 29% YoY to $853 million, while full year sales are projected to grow 12.5% to $4 billion. Current quarter earnings, which have been revised higher by 10% over the last 90 days are expected to grow 6.4% YoY to $2.18 per share, and next year earnings are projected to grow 12% to $12.55 per share.
Image Source: Zacks Investment Research
Brand
Crocs is one of the most popular footwear brands in the world. It is famous for its iconic clog made with extremely light and comfortable materials. The company offers a wide variety of footwear products including sandals, wedges, flip-flops, and slides that cater to people of all ages. Crocs’ products are available in more than 80 countries and are distributed via wholesale, retail, and e-commerce platforms.
Booming E-commerce Growth
Crocs has made significant progress on building out its e-commerce and omnichannel sales capabilities, with its internet sales helping really boost growth. Crocs has maintained its focus on brand strength by increasing its social media efforts with strategic collaborations, and influencer campaigns. CROX has also improved customer experience through its Crocs mobile app.
Digital sales advanced 80% year over year in Q4 and represented 45.1% of total revenues, up from last year’s Q4 figure of 40.3%.
Opportunities Abroad
While domestic sales growth was just 0.3%, Asia Pacific and EMEA regions saw booming progress. Asia Pacific experienced 59% YoY sales growth, while EMEA grew 60%. These two segments now make up 13% and 15% of total sales respectively.
In the Asia Pacific region, where the climate is considerably hotter, and per capita income lower, you must imagine Crocs products will be a natural fit for consumers with many years of adoption ahead.
Reasonable Valuation
Even after the phenomenal growth of the last few years CROX is still trading at a reasonable valuation. At 11x one-year forward earnings, it is well below its three-year median of 19x, and the industry average 14x.
Image Source: Zacks Investment Research
Technical Setup
Another bullish catalyst for Crocs is this compelling technical chart pattern. Since the October low, CROX stock has been stair-stepping its way higher, consolidating and breaking out every couple months. Now, the price action has carved out a third consolidation, which should propel the stock considerably higher. The breakout will be confirmed if price can trade above $130. Alternatively, below $110 and the chart pattern is invalid.
Image Source: TradingView
Bottom Line
Crocs has become an iconic brand whose products are recognized around the world. Even still, the company seems to have many years of future growth to look forward to. With its well-rounded product line, digital-first focus, growing international adoption, and improving earnings outlook, Crocs should be on the top of your list of stocks to buy.