CROX Crocs Inc

Crocs, Inc. (CROX) continues to rebound from a tough sell off in 2009, recently hitting a new multi-year high after reporting strong Q2 results that came in ahead of expectations. With estimates taking a big jump on the news, this Zacks #1 Rank stock is a good fit for momentum.

Company Description

Crocs, Inc. designs and sells footwear, apparel and accessories for men, woman and children worldwide. The company was founded in 1999 and has a market cap of $2.8 billion.

CROX has been surging higher for most of the last year, but shares got an extra boost on July 27 after the company reported another great quarter that came in well ahead of expectations.

Second-Quarter Results

Revenue for the period was up 29% from last year to $296 million. Earnings also looked good, coming in at 61 cents, 39% ahead of the Zacks Consensus Estimate.

Once again, Crocs saw a nice balance across its different channels, with wholesale sales up 26% to $176 million, retail sales up 38% to $92 million and Internet sales up 30% to $28 million.

From a geographic perspective, Europe saw the biggest gain, with sales up 50% to $52 million. Its largest region, Asia, saw sales climb 38% to $122 million.

Financial Profile

The company has used its recent earnings momentum to strengthen its balance sheet, with cash and short-term investments up 85% from last year to $180 million against a marginal debt load of just $3 million.

Estimates

We saw some pretty solid movement in estimates off the good quarter, with the current year 26 cents to $1.38 while the next-year estimate added 25 cents to $1.65, a bullish 20% growth projection.

Valuation

But in spite of the gains, the valuation still looks reasonable, with a PEG ratio of 1.1, only marginally higher than the benchmark for value of 1.

12-Month Chart

On the chart, shares jumped into a new multi-year high on the good quarter. Take a look below.

Michael Vodicka is the Momentum Stock Strategist for Zacks.com. He is also the Editor in charge of the Zacks Momentum Trader Service.
 
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