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How Did Wolverine World Wide Perform in Fiscal 4Q15?

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Price movement 

Wolverine World Wide (WWW) rose by 7.7%. It closed at $18.61 per share at the end of the last week of February 2016. The price movement on a weekly, monthly, and YTD (year-to-date) basis is 7.7%, 17.9%, and 11.4%, respectively.

Currently, Wolverine World Wide is trading 8.9% above its 20-day moving average, 11.4% above its 50-day moving average, and 18.4% below its 200-day moving average.

The iShares Russell 2000 ETF (IWM) invests 0.16% of its holdings in Wolverine World Wide. IWM tracks a market-cap-weighted index of US small-cap stocks. The index selects stocks ranked from 1,001 to 3,000 by market cap. IWM’s YTD price movement was -9.8% as of February 25, 2016.

The market caps of Wolverine World Wide’s competitors are as follows:

  • Skechers USA (SKX) – $5.2 billion
  • Steven Madden (SHOO) – $2.2 billion
  • Deckers Outdoor (DECK) – $1.8 billion
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Performance in 4Q15 and 2015

Wolverine World Wide reported fiscal 4Q15 revenue of $751.2 million—a fall of 7.1% compared to revenue of $808.9 million in fiscal 4Q14. The revenue of the lifestyle group and heritage group fell by 7.7% and 15.5%, respectively. The revenue of the performance group rose by 0.7% in fiscal 4Q15—compared to fiscal 4Q14. It reported restructuring costs of $3.0 million in fiscal 4Q15—compared to $0.4 million in fiscal 4Q14.

Its net income and EPS (earnings per share) rose to $11.9 million and $0.12, respectively, in fiscal 4Q15—compared to $11.2 million and $0.10, respectively, in fiscal 4Q14.

Fiscal 2015 results

In fiscal 2015, Wolverine World Wide reported revenue of $2,691.6 million—a fall of 2.5% year-over-year. It reported restructuring costs of $3.0 million in fiscal 2015—compared to $1.0 million in fiscal 2014. Its net income and EPS fell to $123.2 million and $1.20, respectively, in fiscal 2015—compared to $133.9 million and $1.30, respectively, in fiscal 2014.

Meanwhile, its cash and cash equivalents fell by 13.3%. Its inventories rose by 12.7% in fiscal 2015. Its current ratio and long-term debt-to-equity ratio fell to 2.9x and 0.83x, respectively, in fiscal 2015—compared to 3.1x and 0.91x, respectively, in fiscal 2014. It reported operating free cash flow of $165.5 million in fiscal 2015.

Wolverine World Wide’s price-to-earnings and price-to-book value ratios are 15.5x and 1.9x, respectively, as of February 26, 2016.

Projections

The company made the following projections for fiscal 2016:

  • Consolidated revenue of $2.475 billion–$2.575 billion
  • A flat to slightly lower gross margin from lower product costs offset by ~0.90% of negative currency impact
  • A flat to slightly lower adjusted operating margin including 0.90% of negative currency impact
  • Adjusted effective tax rate of ~28.0%
  • Adjusted EPS of $1.30–$1.40, constant currency adjusted EPS of $1.48–$1.58, and reported EPS of $1.20–$1.30
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