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Stock Market & Financial Investment News

News Breaks
July 22, 2014
13:05 EDTCROXCrocs jumps after racing past expectations, detailing store strategy
Shares of footwear maker Crocs (CROX) are jumping after the company reported second quarter earnings per share and revenue that exceeded analysts' consensus. Crocs also detailed its strategic plans, which includes cost-saving measures and store closures. WHAT'S NEW: Crocs' EPS of 36c beat analysts' consensus of 31c and its Q2 revenue of $376.92M was higher than analysts' consensus of $372.76M. Crocs reported that its global Q2 same-store sales fell 5.1%, as SSS in the Americas for the quarter were down 6.2% and its SSS in Asia Pacific was down 6%, though its SSS in Europe rose 1.1%. The company foresees Q3 revenue to be between $300M-$305M, compared to analysts' consensus of $300.5M prior to the update. Crocs detailed its strategic plans for long-term improvement and growth of the business, including streamlining its product and marketing portfolio, reducing direct investment in smaller geographic markets, reducing duplicative and excess overhead, and closing or converting approximately 75 to 100 Crocs branded retail stores globally. The company expects cost savings associated with the reduction in force of $4M in FY14 and $10M in FY15. The company expects store closings will reduce revenue by approximately $35M-$50M and reduce SG&A expense by approximately $17M-$25M with an insignificant impact on future operating income. ANALYST REACTION: Buckingham analyst Scott Krasik reiterated his Buy rating on Crocs after the company reported "solid" Q2 revenue and EPS that was better than expectations. Krasik is "encouraged" by management's outlook for mid-single digit backlog and thinks investors should add to positions after seeing the first details of the company's restructuring plans. PRICE ACTION: During afternoon trading, Crocs was up $1.65 or 11.1%, to $16.49.
News For CROX From The Last 14 Days
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January 30, 2015
11:59 EDTCROXDeckers Outdoor plummets after missing Q3 estimates, cutting outlook
Shares of casual apparel and footwear maker Deckers Outdoor (DECK) are sinking after the company's third quarter results missed analysts' expectations. The company also lowered its outlooks for the fourth quarter and fiscal year 2015. WHAT'S NEW: Last night, Deckers Outdoor reported Q3 earnings per share of $4.50 and revenue of $784.7M, trailing analysts' consensus estimates of $4.52 and $813.7M, respectively. Direct-to-Consumer comparable sales increased 7.6% over the same period a year ago. UGG brand sales increased 6.5% to $736M, compared to $690.9M for the same period last year. E-Commerce sales increased 25.2% to $146.9M compared to $117.3M for the same period last year. Gross margin increased 180 basis points to 52.9% compared to 51.1% for the same period last year. Deckers also announced that its board of directors approved the repurchase of an additional $200M of the company's common stock. WHAT’S NOTABLE: Looking ahead to Q4, Deckers Outdoor cut its EPS view to 0c from 15c, well below analysts' consensus estimates of 13c. The company still expects Q4 revenues to increase approximately 10% over the year-ago period, versus analysts' estimates $327.17M. The company cited gross margin pressure from foreign currency exchange rates for the weak forecast. Additionally, Deckers lowered its FY15 EPS view to $4.58 from $4.71, well short of the consensus of $4.77. The company also cut its FY15 revenue outlook to approximately $1.8B, down from the previous guidance of approximately $1.825B, trailing analysts' consensus estimates of $1.83B. Deckers now sees FY15 UGG Brand revenues up approximately 11% over last year, down from previous guidance of approximately 14%, and sees FY15 Teva and Sanuk brand revenues up low double digits over the year-ago period. The FY15 guidance assumes a gross profit margin of approximately 49%, an operating margin of approximately 12.5% compared to previous guidance of approximately 13% and an effective tax rate of approximately 27% compared to previous guidance of 29%. ANALYST REACTION: This morning, analyst commentary was mixed. Research firm Telsey Advisory downgraded Deckers Outdoor to Market Perform from Outperform following the Q3 report due to the UGG shortfall and lack of near-term catalysts. Telsey also lowered its price target on the shares to $80 from $98. Conversely, Jefferies said Deckers’ risk/reward is favorable at current levels. Jefferies said it continues to view Deckers Outdoor as a "compelling investment opportunity" despite the Q3 sales miss. It believes the UGG brand is "still a winner" and that the company has lots of opportunity to expand margins. The firm lowered its price target for Deckers’ shares to $110 from $130 and kept a Buy rating on the name. Susquehanna, which has a Positive rating but lowered its price target to $83 from $117, believes the weakness in Deckers Outdoor shares is overdone. The firm sees a stock buyback as a possible near-term catalyst, as well as the potential for a dividend as supporting the shares. PRICE ACTION: In late morning trading, Deckers Outdoor fell $15.05, or about 18.3%, to $67.22 on nearly six times its average daily trading volume. Including today’s pullback, the stock has lost approximately 13% over the past twelve months. OTHERS TO WATCH: Other casual apparel/footwear makers include Skechers USA (SKX), down 2%, Wolverine World Wide (WWW), down 2.16%, Rocky Brands (RCKY), down 2.85%, and Crocs (CROX), down 0.75%.

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