Skechers: Buy SKX Stock While It Regains Its Footing

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Skechers (SKX) stock has skidded to a halt and is about to finish the trading day 9% lower from where it started. Before I dig into what sparked the selloff, let’s take a moment to review Skeckers.

skx stock skechersWith more than 3,000 different styles for men, women and children, Skechers provides footwear in two different categories: lifestyle and high-performance. In addition, Skechers offers apparel, bags, watches, eye wear and other merchandise under the Skechers brand.

Skechers sells its products through department and specialty stores in countries around the globe, including Ireland, France, Germany, Spain, Austria, Brazil, Chile, Japan, Singapore and China — just to name a few. Skechers also has global distributors in more than 120 countries and territories and nearly 900 Skechers’ stores around the world.

Now, what we’re seeing right now is a bit of profit-taking due to concerns that shoe sales are slowing. Last week, casual athletic shoe sales slowed to 7.6% growth, after a hot 42% gain during the back-to-school season. Many investors took this as their cue to book some profits.

SKX shares’ 72% surge this year is far from over. Last quarter, Skechers beat earnings estimates by a whopping 60% and reported 385% bottom-line growth over last year. Plus, Skechers’ forecasted earnings and sales remain strong. The analyst community is looking for nearly 70% year-over-year earnings growth and 21% sales growth. Furthermore, analysts have revised their estimates 12.5% higher in the past 90 days, which bodes well for another earnings surprise.

Skechers is expected to report third-quarter results towards the end of October, and I expect that this will be the occasion for SKX stock to regain its footing. I recommend SKX as an “A-rated strong buy” and consider today’s dip a great buying opportunity.

Louis Navellier is a renowned growth investor. He is the editor of five investing newsletters: Blue Chip GrowthEmerging GrowthUltimate GrowthFamily Trust and Platinum Growth. His most popular service, Blue Chip Growth, has a track record of beating the market 3:1 over the last 14 years. He uses a combination of quantitative and fundamental analysis to identify market-beating stocks. Mr. Navellier has made his proven formula accessible to investors via his free, online stock rating tool, PortfolioGrader.com. Louis Navellier may hold some of the aforementioned securities in one or more of his newsletters.


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