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Apparel Earnings: Will Consumer Strength Fuel Crocs?
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We’ve got a stacked earnings schedule this week, with nearly every pocket of the economy being represented.
Among the bunch is a consumer-facing company – Crocs (CROX - Free Report) . Shares have been red-hot in 2024, gaining more than 40% and regularly boosted by quarterly results. But can the company deliver again?
Let’s take a closer look at a few results from other consumer-facing companies, including Deckers Outdoor (DECK - Free Report) and Skechers (SKX - Free Report) , as a light guide.
Deckers Outdoor Posts Robust Results
Deckers Outdoor posted a strong quarter, exceeding both earnings and revenue expectations handily and continuing its streak of earnings positivity. EPS grew a staggering 90% year-over-year, whereas sales shot 22% higher from the year-ago period.
Continued brand momentum among UGG and Hoka shoes aided the robust results, leading the company to up its current fiscal year outlook. Analysts have updated their outlook for the company’s current fiscal year accordingly following the print, with the $31.52 Zacks Consensus EPS estimate suggesting 8% growth year-over-year.
Image Source: Zacks Investment Research
The company has also been enjoying margin expansion, aiding its profitability picture nicely. And it enjoyed the same throughout its latest release, with its gross margin expanding to 56.9% vs 51.3% in the year-ago period.
Please note that the chart below is on a trailing twelve-month basis.
Image Source: Zacks Investment Research
Skechers Sees Strong DTC Growth
Skechers didn’t see the same positive reaction to its quarterly release, with the company seeing a 7% EPS decline on a 7% sales increase. Both items missed relative to Zacks Consensus estimates, snapping a long streak of positive surprises.
Still, sales of $2.2 billion reflected a quarterly record, with its Direct-to-Consumer (DTC) sales improving an impressive 9.2% year-over-year. The DTC sales growth is undoubtedly positive, reflective of a healthy market position.
Like DECK, Skechers enjoyed margin expansion throughout the period thanks to lower freight and lower costs per unit, reporting a gross margin improvement of 220 basis points to 54.9%. The company’s margins have been historically strong, as illustrated below.
Image Source: Zacks Investment Research
Positive revisions for its current fiscal year hit the tape following the print, with the stock carrying a favorable Zacks Rank #2 (Buy).
Image Source: Zacks Investment Research
Crocs Looks to Build on Record Sales
Estimates for CROX’s upcoming release have remained stable, with earnings expected to be down 2% on 2.5% higher sales. It’s worth noting that the stock popped following its latest set of quarterly results thanks to a guidance upgrade, with sales of $940 million reflecting a quarterly record.
Continued brand momentum led to its latest guidance upgrade, with its Crocs brand showing 15% year-over-year sales growth throughout the period. And like both companies above, the company enjoyed margin expansion throughout the period, further exciting investors and boosting post-earnings gains.
Image Source: Zacks Investment Research
Putting Everything Together
Apparel favorite Crocs (CROX - Free Report) is gearing up to unveil its quarterly results this week, building on recent reports from other consumer-facing companies such as Deckers Outdoor (DECK - Free Report) and Skechers (SKX - Free Report) .
Both Deckers Outdoor and Skechers posted overall positive results, reporting continued brand momentum and margin expansion. DECK upped its guidance, leading to its positive post-earnings reaction. SKX didn’t see much positivity following its respective release, but shares have remained stable and so have earnings estimate revisions.
It’s reasonable to expect that Crocs has continued to enjoy margin expansion given favorable reads from DECK and SKX, with Crocs’ record quarterly sales in its latest release also alluding to underlying brand momentum.
Given its favorable earnings outlook and recent brand momentum, the stock remains a prime selection for investors, and a post-earnings dip could certainly be bought if the company provides favorable guidance that keeps the earnings estimate revisions trends positive.
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Apparel Earnings: Will Consumer Strength Fuel Crocs?
We’ve got a stacked earnings schedule this week, with nearly every pocket of the economy being represented.
Among the bunch is a consumer-facing company – Crocs (CROX - Free Report) . Shares have been red-hot in 2024, gaining more than 40% and regularly boosted by quarterly results. But can the company deliver again?
Let’s take a closer look at a few results from other consumer-facing companies, including Deckers Outdoor (DECK - Free Report) and Skechers (SKX - Free Report) , as a light guide.
Deckers Outdoor Posts Robust Results
Deckers Outdoor posted a strong quarter, exceeding both earnings and revenue expectations handily and continuing its streak of earnings positivity. EPS grew a staggering 90% year-over-year, whereas sales shot 22% higher from the year-ago period.
Continued brand momentum among UGG and Hoka shoes aided the robust results, leading the company to up its current fiscal year outlook. Analysts have updated their outlook for the company’s current fiscal year accordingly following the print, with the $31.52 Zacks Consensus EPS estimate suggesting 8% growth year-over-year.
Image Source: Zacks Investment Research
The company has also been enjoying margin expansion, aiding its profitability picture nicely. And it enjoyed the same throughout its latest release, with its gross margin expanding to 56.9% vs 51.3% in the year-ago period.
Please note that the chart below is on a trailing twelve-month basis.
Image Source: Zacks Investment Research
Skechers Sees Strong DTC Growth
Skechers didn’t see the same positive reaction to its quarterly release, with the company seeing a 7% EPS decline on a 7% sales increase. Both items missed relative to Zacks Consensus estimates, snapping a long streak of positive surprises.
Still, sales of $2.2 billion reflected a quarterly record, with its Direct-to-Consumer (DTC) sales improving an impressive 9.2% year-over-year. The DTC sales growth is undoubtedly positive, reflective of a healthy market position.
Like DECK, Skechers enjoyed margin expansion throughout the period thanks to lower freight and lower costs per unit, reporting a gross margin improvement of 220 basis points to 54.9%. The company’s margins have been historically strong, as illustrated below.
Image Source: Zacks Investment Research
Positive revisions for its current fiscal year hit the tape following the print, with the stock carrying a favorable Zacks Rank #2 (Buy).
Image Source: Zacks Investment Research
Crocs Looks to Build on Record Sales
Estimates for CROX’s upcoming release have remained stable, with earnings expected to be down 2% on 2.5% higher sales. It’s worth noting that the stock popped following its latest set of quarterly results thanks to a guidance upgrade, with sales of $940 million reflecting a quarterly record.
Continued brand momentum led to its latest guidance upgrade, with its Crocs brand showing 15% year-over-year sales growth throughout the period. And like both companies above, the company enjoyed margin expansion throughout the period, further exciting investors and boosting post-earnings gains.
Image Source: Zacks Investment Research
Putting Everything Together
Apparel favorite Crocs (CROX - Free Report) is gearing up to unveil its quarterly results this week, building on recent reports from other consumer-facing companies such as Deckers Outdoor (DECK - Free Report) and Skechers (SKX - Free Report) .
Both Deckers Outdoor and Skechers posted overall positive results, reporting continued brand momentum and margin expansion. DECK upped its guidance, leading to its positive post-earnings reaction. SKX didn’t see much positivity following its respective release, but shares have remained stable and so have earnings estimate revisions.
It’s reasonable to expect that Crocs has continued to enjoy margin expansion given favorable reads from DECK and SKX, with Crocs’ record quarterly sales in its latest release also alluding to underlying brand momentum.
Given its favorable earnings outlook and recent brand momentum, the stock remains a prime selection for investors, and a post-earnings dip could certainly be bought if the company provides favorable guidance that keeps the earnings estimate revisions trends positive.