CROX

Crocs Inc

Consumer


Presented:07/21/2022
Price:$63.89
Cap:$3.93B
Current Price:$140.45
Cap:$8.34B

Presented

Date07/21/2022
Price$63.89
Market Cap$3.93B
Ent Value$7.59B
P/E Ratio5.74x
Book Value$5.67
Div Yield0%
Shares O/S61.58M
Ave Daily Vol1,785,842
Short Int7.02%

Current

Price$140.45
Market Cap$8.34B
Crocs, Inc. engages in the design, development, manufacturing, worldwide marketing, sale and distribution of casual footwear, apparel, and accessories for men, women, and children. It operates through the following segments: Americas, Asia Pacific and Europe, Middle East & Africa (EMEA). The Americas segment consists of the revenues and expenses related to product sales in North and South America. The Asia Pacific segment includes the revenues and expenses related to the product sales in Asia, Australia and New Zealand. The EMEA segment contains the revenues and expenses related to the product sales in Europe, Russia, Africa and the Middle East. The company was founded by Scott Seamans, George B. Boedecker, Jr. and Lyndon V. Hanson III in 2002 and is headquartered in Broomfield, CO.

Publicly traded companies mentioned herein: Academy Sports & Outdoors Inc (ASO), Crocs Inc (CROX), Deckers Outdoor Corp (DECK)

Highlights 

The presenter is long shares of Crocs Inc (CROX), which has continued its strong pre-COVID growth through the pandemic and more recent macroeconomic softness despite the popular sentiment that its products are a fad and the business will slow down eventually. Q1’22 performance was strong (47% YoY revenue growth on a tough comp with 27% operating margins), and the presenter expects a solid Q2 based on his channel checks. Additionally, he is bullish on last year’s $2.5B acquisition of Heydude, thinking Heydude growth and international growth in both brands can offset some concerns about the US growth slowdown for the Crocs brand. Recent insider buying activity from the management team adds to his confidence that this is a cheap stock which should continue beating on earnings. CROX currently trades at $62 per share (5.5x consensus 2023 EPS), and he targets 70% upside to $105 per share using an 8.5x multiple on his 2023 EPS estimate; this valuation seems reasonable since CROX has traded at 20x+ in the past. 

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