Skechers is Wednesday's IBD Stock Of The Day, as the footwear maker trades just below a buy point amid lower-than-average volume. SKX edged up Wednesday, hot on the heels of the Roger Federer-backed On Holding.
Manhattan Beach, Calif.-based Skechers makes a variety of slip-on, comfort, casual and walking shoes. Set to report second-quarter financials on July 27, analysts expect earnings per share to fall roughly 9% to 53 cents. Meanwhile, sales are seen increasing around 1% to $1.91 billion.
The company has forecast Q2 EPS of 40 to 50 cents and revenue of $1.85 to $1.91 billion. Skechers' full-year earnings fell 8% to $2.38 per share in 2022 vs. 2021. But Wall Street sees profit growth in 2023, with EPS jumping to $3.18.
In late April, Skechers reported a better-than-expected Q1 performance as it works to pull customers from competitors.
Skechers' Q1 earnings jumped 24.7% on a 10% revenue gain. Before that, company earnings averaged a 5% quarterly decline over the prior four periods. Revenue surged an average 18.3% in that same stretch.
In January, Cowen analyst John Kernan noted Skechers' "value-oriented positioning is resonating with consumers" as macroeconomic pressures influence spending. Skechers is also picking up traction among affluent customers. It reportedly gained most of its casual footwear market share last year from consumers making over $100,000 a year.
Skechers Stock
SKX gained 1% to 54.46 Wednesday during market trade. Shares briefly cleared a 54.77 flat-base buy point, according to MarketSmith analysis. In addition, Skechers stock still appears actionable from the 50-day line.
SKX has surged more than 30% so far in 2023 and is up around 4% in July. Skechers stock ranks fourth in IBD's Apparel-Shoes industry group, behind top seed ONON. SKX has a 91 Composite Rating of 99. Skechers stock has a 87 Relative Strength Rating and a 68 EPS Rating.
Nike stock edged down 0.6% to 109.01 Wednesday. Meanwhile, ONON has risen 5% above a 33.67 cup-with-handle buy point this week, according to MarketSmith.
ONON stock has regained its footing after selling off amid concerns about excess inventory following the shoemaker's May 16 first-quarter earnings report.
Last week, Piper Sandler analyst Abbie Zvejnieks touted ONON stock as a "top growth idea." The Swiss athletic footwear and apparel maker, behind the popular On running-shoe brand, went public at 24 per share in September 2021 and is backed by tennis champion Roger Federer.
Please follow Kit Norton on Twitter @KitNorton for more coverage.
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