Try This Top Footwear Retailer On For Size

As I write this, shares of Skechers USA Inc. (SKX) have skidded to a halt and are 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 the company.

With more than 3,000 different styles for men, women and children, Skechers provides footwear in two different categories, lifestyle and high-performance. In addition, it offers apparel, bags, watches, eyewear and other merchandise under the Skechers’ brand. The company 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. It 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 amidst 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. And many investors took this as their cue to book some profits.

But here’s what they’re missing: SKX shares’ 72% surge this year is far from over. Last quarter the company beat earnings estimates by a whopping 60% and reported 385% bottom-line growth over last year. And Skechers’ forecasted earnings and sales remain strong. The analyst community is looking for nearly 70% year-over-year earnings growth and 21% sales growth. Plus, 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 to regain its footing. I recommend SKX as an A-rated Strong Buy and consider today’s dip a great buying opportunity.

Sincerely,

Signed Louis Navellier

Louis Navellier

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