EARNINGS PER SHARE (Trailing 12 Quarters)
The National Oceanic and Atmospheric Administration (NOAA) doesn’t have a handle yet since their June 30 prediction for Winter 2014 came out so fingers crossed, if you’re a Deckers shareholder, for a cold one. Still, looking at the charts and the company’s spending spree for a 70% increase in square footage with new stores, this isn’t a buy.
Crocs branched out considerably from clogs with boots, flats, wedges, and athletic shoes for men, women, and children. While past investors received some sweet returns, the stock is down 23.51% over the last year.
Crocs does have a reasonable debt ratio of 1.49, short interest is decreasing, price to sales is 1.01, and trailing P/E of 11.35 is much lower than the industry average. Crocs also has $3.16 in cash per share, not bad since it’s trading at $13 and change.
EARNINGS PER SHARE (Trailing 12 Quarters)
Second quarter earnings missing EPS estimates of $0.60 by $0.20 were partly to blame for a Sterne Agee downgrade to Underperform. The chart implies that the company may have trouble bringing up EPS in the back half of the year. The company offered markdowns because of the weather, which made revenues look better but hit gross margin much like Deckers. Gross margin dropped from 59.3% to 55.2%.
REVENUE (Trailing 12 Quarters)
Steven Madden, Ltd. (NASDAQ:SHOO) is expanding into accessories, apparel, and luggage with its breakout Betsey Johnson brand. Deckers’ Tsubo and Uggs compete with Steven Madden (NASDAQ:SHOO) on dress shoes and boots. But Steven Madden, Ltd. (NASDAQ:SHOO) boots are leather, more fashion forward.
The company owns 113 stores, three of them e-commerce focused. The other 85% of the business is direct-to-merchants like JW Nordstrom, Macy’s, and Neiman Marcus. The company has $290.13 million in cash and no debt.
Their revenue chart looks in line to beat last year’s numbers as does the EPS chart. The trailing P/E is extended at 18.93 after several quarters of good news, more expensive than Deckers and Crocs. Price to sales is higher at 1.85 but it has $6.68 cash per share, no debt, and offers special dividends every so often.
REVENUE (Trailing 12 Quarters)
The company reported second quarter results on August 1 highlighting a 110 basis point gain in gross margin to 37.2%, net income up 8%, and opening new stores. Fewer markdowns and tight inventory control helped earn them a Goldman Sachs upgrade from Sell to Buy.
The Foolish takeaway
Deckers needs a cold winter and plenty of boot sales to offset decelerating EPS growth. Crocs is in a better position. Steven Madden, Ltd. (NASDAQ:SHOO) can continue its positive momentum by putting more boots on the ground than their rivals.
The article Boots on the Ground Means More Money for You originally appeared on Fool.com and is written by AnnaLisa Kraft.
AnnaLisa Kraft has no position in any stocks mentioned. The Motley Fool owns shares of Crocs.
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