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Crocs (CROX)
NASDAQ:CROX
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Crocs
(NASDAQ:CROX)
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Rating:62Neutral
Price Target:
$104.00
▲(3.96% Upside)
The score is driven primarily by solid underlying cash generation and improved leverage, but it is held back by the sharp deterioration in the latest reported results and conservative near-term guidance (including HeyDude weakness and tariff pressure). Technicals are supportive with price above major averages, while valuation is less favorable at ~27x earnings without a dividend.
Positive Factors
Strong free cash flow and capital returns
Sustained absolute cash generation provides durable financial flexibility: enables meaningful buybacks, debt paydown and funding of expansion without relying on external financing. Strong historical FCF coverage of earnings supports resilience through cyclical softness and strategic reinvestment.
Improved leverage and balance-sheet flexibility
Material reduction in leverage enhances solvency and lowers financial risk, improving capacity to absorb revenue volatility or tariff shocks. Lower debt levels support opportunistic capital allocation and maintain runway for store openings and DTC investments over the medium term.
Direct-to-consumer & international growth
A larger DTC mix and faster international expansion raise gross-margin stability and customer economics long-term. Higher DTC penetration improves data-driven marketing, pricing control and margin capture, while international diversification reduces single-market dependency.
Negative Factors
Sharp deterioration in 2025 earnings
A pronounced swing to a loss and material revenue disruption signals earnings volatility and weaker operating leverage. If structural drivers persist, margin recovery and ROE restoration could take multiple quarters, pressuring investment and return metrics until stability returns.
HeyDude brand and wholesale disruption
Sustained weakness at HeyDude and wholesale channel cleanup reduces enterprise diversification and unit growth momentum. Prolonged underperformance in this brand may require incremental marketing or inventory actions, weighing margins and management bandwidth over several quarters.
Tariff-driven margin headwinds and timing risk
Ongoing tariff costs create structural margin pressure and quarter-to-quarter volatility in gross margins. Even with mitigation plans, the incremental ~$80M headwind forces cost offsets or pricing actions that can compress near-term profitability and complicate reliable margin expansion timelines.
Crocs (CROX) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$4.93B
Dividend YieldN/A
Average Volume (3M)1.19M
Price to Earnings (P/E)―
Beta (1Y)0.77
Revenue Growth<0.01%
EPS Growth-77.31%
CountryUS
Employees7,910
SectorConsumer Cyclical
Sector Strength84
IndustryApparel - Footwear & Accessories
Share Statistics
EPS (TTM)2.29
Shares Outstanding50,233,597
10 Day Avg. Volume1,684,588
30 Day Avg. Volume1,189,441
Financial Highlights & Ratios
PEG Ratio0.52
Price to Book (P/B)3.58
Price to Sales (P/S)1.15
P/FCF Ratio7.03
Enterprise Value/Market Cap1.35
Enterprise Value/Revenue1.65
Enterprise Value/Gross Profit2.83
Enterprise Value/Ebitda19.50
Forecast
1Y Price Target
$101.44Price Target Upside1.40% Upside
Rating ConsensusHold
Number of Analyst Covering10
EPS Forecast (FY)13.15
Revenue Forecast (FY)$4.03B
Crocs Business Overview & Revenue Model
Company DescriptionCrocs, Inc., together with its subsidiaries, designs, develops, manufactures, markets, and distributes casual lifestyle footwear and accessories for men, women, and children. It offers various footwear products, including clogs, sandals, slides, flip-flops, boots, flats, wedges, platforms, socks, shoe charms, loafers, sneakers, and slippers under the Crocs brand name. The company sells its products in approximately 85 countries through wholesalers, retail stores, e-commerce sites, and third-party marketplaces. As of December 31, 2021, it had 193 outlet stores, 107 retail stores, 373 company-operated stores, 73 kiosks and store-in-stores, and 14 company-operated e-commerce sites. The company serves in the Americas, the Asia Pacific, Europe, the Middle East, and Africa. Crocs, Inc. was founded in 1999 and is headquartered in Broomfield, Colorado.
How the Company Makes MoneyCrocs generates revenue primarily through the direct sale of its footwear products across multiple channels including retail stores, e-commerce platforms, and wholesale distribution. The company has established a strong online presence, leveraging its website and partnerships with major e-commerce retailers to reach a broader audience. Key revenue streams include sales from its signature clogs, seasonal collections, and collaborations with designers and brands that create limited-edition footwear. Additionally, Crocs benefits from a growing trend towards casual and comfortable footwear, which has been further amplified by the increasing consumer preference for versatile and functional shoes. Strategic partnerships with retailers and collaborations with influencers and celebrities also enhance brand visibility and drive sales, contributing significantly to the company's earnings.
Crocs Key Performance Indicators (KPIs)
Any
Revenue by Segment
Breaks down revenue from different business segments, offering insight into which areas are driving growth and profitability.
Breaks down revenue from different business segments, offering insight into which areas are driving growth and profitability.
Data provided by:
The Fly
The FlyCrocs Earnings Call Summary
Earnings Call Date:Feb 12, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 13, 2026
Earnings Call Sentiment Neutral
The call presented a mixed picture: clear operational and strategic strengths (strong free cash flow, large share repurchases, DTC and international growth, product and marketing momentum, and identified cost savings) were counterbalanced by near-term revenue softness (enterprise down ~2%), pronounced weakness at HeyDude (double-digit declines and wholesale cleanup), margin pressure from tariffs, and conservative near-term guidance. Management emphasized that many 2025 strategic actions will continue to weigh on early 2026 results but positioned the company for improvement in the back half of the year.Q4-2025 Updates
Positive Updates
Full-Year Revenue and Brand Mix
Enterprise revenue for FY2025 was just over $4.0 billion, with the Crocs brand at approximately $3.3 billion and HeyDude at $715 million; Crocs brand grew for the eighth consecutive year.
Strong Free Cash Flow and Capital Allocation
Generated $659 million of free cash flow in 2025, used to repay $128 million of debt and repurchase ~6.5 million shares for $577 million (~10% of shares outstanding), with $747 million remaining on the repurchase authorization.
Direct-to-Consumer and International Strength
Direct-to-consumer comprised over half of enterprise revenue and grew faster than wholesale; international Crocs revenue grew 11% for the year and DTC internationally grew 23%.
Unit Growth and ASPs
Total units sold increased 2% year-over-year to 129 million pairs; Crocs brand ASPs were roughly flat year-over-year; HeyDude ASPs rose ~4% to just under $32.
Product, Marketing and Partnerships Momentum
Successful holiday season driven by new product introductions and disruptive marketing; launched/expanded high-impact partnerships (NFL, Stranger Things, Twilight, LEGO), remained #1 footwear brand on TikTok Shop (U.S.), and teased LEGO brick clog at Paris Fashion Week.
Retail and Distribution Expansion
Ended 2025 with ~2,600 Crocs mono-branded stores and kiosks; plans to open 200–250 doors in 2026 across Tier 1 and distributor markets.
Historical Track Record and Market Position
Since IPO, Crocs has sold ~1.5 billion pairs, delivered ~14% compound annual sales growth over 20 years, and produced total shareholder return in excess of 700% since IPO.
Operational Improvements and Cost Savings
Executed a $50 million cost savings program in 2025, identified an additional $100 million of cost savings for 2026 intended to be balanced between COGS and SG&A.
Negative Updates
Enterprise and Segment Revenue Pressure
Enterprise revenue declined approximately 2% for FY2025; Q4 revenue was ~$958 million, down 4% year-over-year. HeyDude revenue declined 14% for the year and Q4 HeyDude fell 18%.
North America Crocs Softness
Crocs North America revenue declined 7% to $1.7 billion for FY2025, driven by pullbacks in promotional activity and managed sell-in.
HeyDude Wholesale Disruption and Unit Decline
HeyDude wholesale revenue fell 27% for the year (and 42% in Q4), unit volume declined 17% year-over-year to 22 million pairs, contributing to the brand's overall revenue decline.
Margin Headwinds from Tariffs and Mix
Enterprise adjusted gross margin declined 50 basis points to 58.3% for the year (Q4 down 320 bps to 54.7%), with a ~130 bps tariff headwind for the year and ~300 bps in Q4; company now estimates an unmitigated annualized tariff headwind of ~$80 million.
Operating Profit and EPS Declines
Full-year adjusted operating margin declined 330 basis points to 22.3%; adjusted diluted EPS was $12.51, down 5% year-over-year.
Near-Term Revenue Guidance and First-Quarter Weakness
FY2026 revenue guidance is modest (up slightly to down 1% reported); Q1 2026 revenue is expected to be down 3.5%–5.5% with HeyDude down 15%–18%, and tariff headwinds expected of ~100 bps in Q1 and ~200 bps in Q2.
Inventory and Margin Timing Risks
Inventory dollars increased ~4% versus prior year (inventory units down high single digits), and the timing/flow of tariffs creates quarter-to-quarter margin variability and uncertainty in early 2026.
Company Guidance
For fiscal 2026 the company guided enterprise revenue to be roughly flat to down 1% (reported, FX as of Feb 9), with Crocs brand revenue flat to up ~2% (including ~10% international growth offset by North America declines) and HeyDude revenue down roughly 7–9%; management expects DTC to outperform wholesale and the second half to outpace the first half. They expect adjusted gross margin to be up slightly versus 2025 despite an incremental tariff pressure of about 80 basis points (an unmitigated ~$80M annualized headwind, improved from $90M); quarterly tariff pressure is guided at ~100 bps in Q1 and ~200 bps in Q2. Adjusted SG&A dollars are expected to be roughly flat, adjusted operating margin to expand modestly from 22.3% (excluding approximately $25M of discrete implementation costs), and adjusted diluted EPS is guided to $12.88–$13.35 (non‑GAAP tax rate ~18%, GAAP ~23%). For Q1, revenues are expected down 3.5–5.5% (Crocs down low single digits; HeyDude down 15–18%), Q1 adjusted operating margin ~21.5% and Q1 adjusted diluted EPS $2.67–$2.77. The company plans $70–80M of capex, intends to maintain net leverage of 1.0–1.5x while opportunistically buying back shares (guidance assumes future debt repayment but not further repurchases), and has identified $100M of cost savings for 2026 (balanced between COGS and SG&A).Crocs Financial Statement Overview
Summary
Historically strong revenue scale-up and high gross margins, improved leverage (debt-to-equity ~0.30), and solid absolute free cash flow ($659M) support the score. However, the latest year shows a sharp break in reported fundamentals (large revenue decline and net loss), and cash flow momentum also weakened year-over-year, increasing uncertainty around near-term earnings quality.Income Statement
Crocs shows solid multi-year scale-up from 2020–2024, with revenue rising from ~$1.39B (2020) to ~$4.10B (2024) and consistently strong gross margins (~55%–59%). Profitability was robust through 2024 (net margin ~23%), but 2025 deteriorated sharply with a net loss (net margin ~-2%) and a steep revenue decline (-78.9%), signaling a major one-year disruption and much weaker earnings quality versus prior years.56
Neutral
Balance Sheet
Leverage has improved meaningfully over time: debt-to-equity moved from very elevated levels earlier in the period to a more conservative ~0.30 in 2025, with total debt down to ~$383M. However, equity and returns also weakened in 2025 (negative return on equity), and the sharp earnings swing raises questions about balance-sheet resilience if weaker profitability persists.62
Positive
Cash Flow
Cash generation remains a key strength: 2025 operating cash flow was ~$710M and free cash flow was ~$659M, both strong in absolute terms. Cash flow has generally tracked earnings well (free cash flow to net income ~0.83–0.93 historically), but 2025 saw a large free-cash-flow decline (reported -796%) and a drop in operating cash flow coverage versus 2024, indicating increased volatility and weaker momentum year-over-year.72
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 4.04B | 4.10B | 3.96B | 3.55B | 2.31B |
| Gross Profit | 2.36B | 2.41B | 2.18B | 1.86B | 1.42B |
| EBITDA | 979.22M | 1.09B | 1.09B | 893.89M | 717.47M |
| Net Income | -81.20M | 950.07M | 792.57M | 540.16M | 725.69M |
Balance Sheet | |||||
| Total Assets | 4.17B | 4.81B | 4.64B | 4.50B | 1.55B |
| Cash, Cash Equivalents and Short-Term Investments | 130.35M | 180.49M | 149.29M | 191.63M | 213.26M |
| Total Debt | 1.61B | 1.70B | 2.00B | 2.59B | 963.56M |
| Total Liabilities | 2.88B | 2.98B | 3.19B | 3.68B | 1.53B |
| Stockholders Equity | 1.29B | 1.84B | 1.45B | 817.93M | 14.08M |
Cash Flow | |||||
| Free Cash Flow | 659.20M | 923.14M | 814.82M | 498.95M | 511.25M |
| Operating Cash Flow | 710.43M | 992.49M | 930.44M | 603.14M | 567.16M |
| Investing Cash Flow | -51.23M | -69.35M | -115.67M | -2.15B | -55.92M |
| Financing Cash Flow | -714.57M | -886.05M | -859.64M | 1.53B | -429.64M |
Crocs Technical Analysis
Positive
100.04
Price Trends
87.56
Positive
84.71
Positive
90.89
Positive
Market Momentum
2.97
Negative
62.94
Neutral
82.11
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CROX, the sentiment is Positive. The current price of 100.04 is above the 20-day moving average (MA) of 88.00, above the 50-day MA of 87.56, and above the 200-day MA of 90.89, indicating a bullish trend. The MACD of 2.97 indicates Negative momentum. The RSI at 62.94 is Neutral, neither overbought nor oversold. The STOCH value of 82.11 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CROX.
Crocs Risk Analysis
Crocs disclosed 42 risk factors in its most recent earnings report. Crocs reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Crocs Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
83 Outperform | $16.88B | 16.68 | 39.69% | ― | 12.38% | 18.43% | |
72 Outperform | $7.69B | 17.64 | 13.95% | ― | 18.86% | 88.29% | |
64 Neutral | $2.85B | 49.73 | 6.68% | 1.97% | 6.26% | -66.51% | |
62 Neutral | $4.93B | -76.71 | -5.19% | ― | <0.01% | -77.31% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
58 Neutral | $1.52B | 17.65 | 25.57% | 2.28% | 3.61% | ― | |
49 Neutral | $424.03M | 20.21 | 3.33% | 2.11% | -2.83% | -86.19% |
* Consumer Cyclical Sector Average
CROX
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100.04
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-5.71%
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.