Piper downgrades Crocs to Neutral on demand headwinds

Piper Sandler downgraded Crocs (CROX) to Neutral from Overweight with a price target of $75, down from $95. The shares are likely to be range-bound until the company’s sales stabilize, the analyst tells investors in a research note. Piper believes the demand headwinds facing Crocs in the U.S. could be longer lasting than investors anticipate with both the company’s brands undergoing strategic changes. The Crocs brand is pulling back on discounting and HeyDude is pulling back on performance marketing at a time when both are facing uncertainty around demand elasticity, contends Piper. The firm sees risk to Crocs’ Q4 outlook as its share losses persist.