Skechers didn’t please investors
Skechers (SKX) saw a bloodbath in the stock market on July 20. The company disappointed investors with its second-quarter results. The results were released after the market closed on July 19.
While Skechers met analysts’ top-line expectations, it fumbled badly on the bottom line. The EPS was $0.29—$0.12 short of the consensus expectations. The company’s total sales increased 10.6% YoY (year-over-year) to $1.13 billion. Read Part 2 and Part 3 of this series to learn about Skechers’s second-quarter performance.
Management lowered the third-quarter guidance following the second-quarter results. Investors were concerned, which caused the stock to fall as much as 35% during trading before it closed at $26.27—21% below the previous day’s closing price.
Analysts responded quickly to Skechers’ weak results. At least five analysts lowered the target price, while two analysts downgraded the stock. Read Part 5 and Part 6 to learn more about analysts’ recent recommendations.
Skechers clocked total sales of $4.45 billion in the last 12 months and had a market capitalization of $4.2 billion as of July 20. In comparison, industry leader Nike (NKE) recorded trailing 12-month sales of $36.4 billion and had a market capitalization of $124 billion.
After being among the top performing apparel stocks in 2017, Skechers has fallen ~30% in 2018.
ETF investors seeking to add exposure to Skechers could consider the Guggenheim S&P MidCap 400 Pure Growth ETF (RFG). RFG invests 1% of its portfolio in the company.