On Monday, Piper Sandler confirmed its positive stance on Crocs , Inc. (NASDAQ:CROX), maintaining an Overweight rating and a price target of $125.00.
Last week, the firm engaged in investor meetings with Crocs' CFO Susan Healy and VP of IR & Strategy Erinn Murphy, and reviewed the 2025 product lineup for both Crocs and its subsidiary brand, HEYDUDE, at the Fashion Footwear Association of New York (FFANY).
"While 4Q24 sales were guided flat (internal expectations for flat CROCS North America consistent throughout the year), '25 is expected to see growth, with product diversification driving shelf space gains," analysts at Piper Sandler said.
The management team, led by Terrence Reilly for HEYDUDE, is focusing on a strategy of more aggressive brand marketing to boost direct-to-consumer sales and, subsequently, wholesale business. Nevertheless, there is an acknowledgment that the recovery of HEYDUDE may take more time.
Despite trading at 8 times price-to-earnings (P/E), Crocs' shares have lost two points of their multiple in the last two months. The current share price is perceived as "washed out," suggesting that the market has fully accounted for recent concerns.
Piper Sandler believes that the company's profit and loss statement has potential levers for improvement, such as share buybacks and tighter operational expenditures. However, clearer insights into the North American market trajectory and HEYDUDE's stabilization are essential for any potential expansion of the stock's multiple.
Piper Sandler's analysis includes a bull versus bear range for Crocs' stock, which is set between $90 and $130, and the firm reiterates its $125 price target.
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