Crocs is the IBD Stock Of The Day for Monday. The comfort footwear brand raised its outlook following its strong quarterly results last week. Meanwhile, CROX stock is sliding on Monday after clearing a buy point.
Broomfield, Colo.-based Crocs is best known for its rubbery, casual-wear shoes. The company in recent years expanded its Crocs brand portfolio from the classic slip-on clogs to include boots, sandals, wedges and sneakers. The Crocs brand makes up nearly 73% of sales. The company's HEYDUDE brand of suede, leather and canvas comfort shoes make up 27% of revenue after sales catapulted 87% over the year to $269.4 million for the most recent quarter.
Crocs reported Q3 earnings last Thursday, continuing its streak of strong growth. The company's earnings and revenue increased the past 10 consecutive quarters, and sales gains accelerated during the last two quarters.
For the third quarter, Crocs earnings rose 20% to $2.97 per share on a 57% leap in revenue to $985.1 million. Both topped analyst estimates of $2.61 earnings per share on $944.18 million in revenue.
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Crocs adjusted its full-year outlook higher after the results. It's now expecting 2022 EPS to range from $9.95 to $10.30, up from $9.50 to $10.30. Revenue is seen between $3.45 billion and $3.52 billion, up slightly from earlier estimates of $3.95 billion to $3.5 billion. Wall Street predicts full-year earnings of $10.09 per share on $3.46 billion of revenue.
For the year, Crocs brand revenue is seen growing 13% to range from $2.6 billion to $2.63 billion, while HEYDUDE brand sales are seen climbing to $850 million to $890 million.
However, most other footwear stocks aren't doing great. Skechers USA reported declines in earnings the past two quarters. Steve Madden earnings and sales decelerated the past couple quarters. Deckers, though, is doing all right. DECK stock's Relative Strength Rating is near highs and earnings have grown for seven of the past nine quarters.
Crocs Stock Analysis
The stock's relative strength line recently hit its highest levels since mid-February, with its Relative Strength Rating reaching 80 in mid-October.
CROX stock surged over two days to clear the 83.74 buy point for its bottoming base. Shares pulled back 5.8% on Monday to 80.40. But it wouldn't be bad to see action calm a bit before moving higher. Crocs stock is still holding above its 10-week moving average, as well as its 50-day and 200-day lines.
CROX shares are up more than 13% so far this month, but down 37% so far this year.
You can follow Harrison Miller for more stock news and updates on Twitter @IBD_Harrison
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