Bank of America Securities analyst Christopher Nardone reiterated a Buy rating on Crocs yesterday and set a price target of $99.00.
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Christopher Nardone has given his Buy rating due to a combination of factors that suggest potential for future growth despite current challenges. He acknowledges that while the third-quarter guidance was disappointing, there is an optimistic outlook for Crocs’ fundamentals to improve beyond this period. The international segment, which constitutes 50% of sales, showed a promising 16% growth in the second quarter, and Nardone believes that a low double-digit growth rate is achievable in the upcoming quarters.
Moreover, despite a decline in sales, Crocs has maintained strong gross margins, with the brand’s gross margin remaining flat at a record level of 64.2%. Although there are short-term pressures from tariffs and changes in product mix, Nardone expects the gross margin to stay robust due to the company’s focus on controlling promotions. This strategic approach is anticipated to support a strong free cash flow profile. While North American sales are expected to face challenges, Nardone foresees gradual improvement driven by new product innovations and strategic adjustments to offset tariff impacts.
In another report released today, KeyBanc also maintained a Buy rating on the stock with a $95.00 price target.
CROX’s price has also changed moderately for the past six months – from $93.370 to $74.390, which is a -20.33% drop .