Crocs Earnings Preview

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Crocs (NAS: CROX) will try to beat its earnings estimates for the fifth consecutive quarter. The company will unveil its latest earnings on Thursday. Crocs and its subsidiaries are engaged in the design, development, manufacturing, marketing, and distribution of consumer products, mainly casual and athletic shoes and shoe charms, from specialty resins referred to as Croslite.

What analysts say:

  • Buy, sell, or hold?: The majority of analysts back Crocs as a buy. But with 60% of analysts rating it a buy, Crocs is still below the mean analyst rating of its nearest 10 competitors, which average 66.7% buys. Analysts don't like Crocs as much as competitor Steven Madden overall. Four out of five analysts rate Steven Madden a buy compared to three of five for Crocs. While analysts still rate the stock a moderate buy, they are a little more optimistic about it compared to three months ago.
  • Revenue forecasts: On average, analysts predict $274.3 million in revenue this quarter. That would represent a rise of 27.2% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.32 per share. Estimates range from $0.32 to $0.33.

What our community says:
The majority of CAPS All-Stars see CROX as a good bet, with 66.3% giving it an outperform rating. The majority of the Fools are in agreement with the All-Stars as 70.8% give it an outperform rating. Fools are bullish on Crocs and haven't been shy with their opinions lately, logging 1,973 posts in the past 30 days. Crocs' bearish CAPS rating of one out of five stars falls short of the Fool community sentiment.

Management:
Crocs' profit has risen year over year by an average of 55% over the past five quarters.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters.

Quarter

Q2

Q1

Q4

Q3

Gross Margin

57.6%

52.6%

48.9%

55.1%

Operating Margin

21.9%

12.5%

3.1%

12.7%

Net Margin

18.8%

9.5%

2.6%

11.6%

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At the time this article was published

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