On Apr 10, 2014, we issued an updated research report on
Skechers USA Inc.
). We remain impressed with year-over-year growth in the top and
bottom lines that the company witnessed during the fourth quarter
of 2013 owing to strong sales across domestic and international
wholesale operations, and company-owned retail and e-Commerce
Estimates for Skechers have shown an uptrend since the company
reported the fourth quarter results. The company posted earnings
of 28 cents a share that surpassed the Zacks Consensus Estimate
of 17 cents and rose over threefold from 8 cents delivered in the
prior-year quarter owing to strong top-line growth across all
business channels and product categories on both the domestic and
Increased demand for products, product innovation across
multiple categories and healthy performance across all revenue
channels led to a 13.9% jump in revenue to $450.7 million in the
quarter that also came ahead of the Zacks Consensus Estimate of
With more emphasis on the new line of products, cost
containment efforts, inventory management, global distribution
platform and strong backlogs (up 30%), management anticipates
sustaining the growth momentum in 2014.
Management remains committed to focus on new lines of
products, opening of additional Skechers stores and increasing
distribution channels with the development of international
distribution agreements to boost its sales and profitability.
Moreover, international business remains a significant growth
driver for the company's sales. Skechers, through its
distribution networks, subsidiaries and joint ventures, is poised
to enhance its global reach in the footwear market.
The better-than-expected results triggered an upward revision
in the Zacks Consensus Estimate, as analysts become more
constructive on the stock's future performance. This is evident
from the movement witnessed in the Zacks Consensus Estimate that
increased 4.6% to $1.81 for 2014 and 4% to $2.36 per share for
2015 in the past 60 days.
Currently, Skechers holds a Zacks Rank #2 (Buy).
Other Stocks That Warrant a Look
Other better-ranked retail stocks that look promising and are
expected to continue with their upbeat performance include
Brown Shoe Co. Inc.
Foot Locker, Inc.
American Apparel, Inc.
). All these stocks carry a Zacks Rank #2 (Buy).
AMER APPAREL (APP): Free Stock Analysis
BROWN SHOE CO (BWS): Free Stock Analysis
FOOT LOCKER INC (FL): Free Stock Analysis
SKECHERS USA-A (SKX): Free Stock Analysis
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