On Wednesday, an analyst from Baird adjusted the financial outlook for Rocky Brands (NASDAQ:RCKY), a footwear company, following their reported earnings for the first quarter. The price target for the company's stock was raised to $32.00, up from the previous $28.00, while the firm's rating remained at Neutral.
Rocky Brands experienced a solid beginning to the year, with first-quarter revenues and adjusted earnings per share (EPS) exceeding Baird's estimates. The analyst noted that the wholesale segment is reaping benefits from improved inventory management and a return to more standard sales practices. Additionally, the demand for Rocky Brands' lifestyle products is reportedly strong, surpassing the performance of their work and outdoor lines.
The company's full-year revenue projections have been adjusted to the higher end of their previous guidance, which may still include a degree of caution. In response to these developments, Baird has increased its expected EPS for 2024 to $2.90. This figure includes the anticipated benefits from debt refinancing, estimated to contribute approximately $0.28 to the EPS.
The valuation of Rocky Brands, based on the next twelve months' enterprise value to earnings before interest, taxes, depreciation, and amortization (EV/EBITDA) ratio of 7.0, is considered reasonable by Baird. This assessment hinges on the continuation of the company's current performance trajectory.
InvestingPro Insights
An in-depth look at Rocky Brands through InvestingPro's real-time data and analytics reveals a nuanced picture of the company's financial health and market performance. The company's market capitalization stands at $191.3 million, with a price-to-earnings (P/E) ratio of 18.54, adjusted to 15.04 for the last twelve months as of Q4 2023. This indicates that while the company is trading at a higher P/E ratio currently, its earnings over the past year suggest a more favorable valuation. The price/book value as of the same period is 0.86, which might appeal to value investors seeking assets trading below their book value.
InvestingPro Tips highlight that Rocky Brands' stock price movements have been quite volatile, which may be of interest to investors looking for short-term trading opportunities or those with a higher tolerance for risk. Additionally, the company has maintained dividend payments for 12 consecutive years, currently yielding 2.41%, which could attract income-focused investors. Notably, analysts predict the company will be profitable this year, a sentiment backed by the company being profitable over the last twelve months.
For investors seeking further insights and analysis on Rocky Brands, there are additional InvestingPro Tips available at https://www.investing.com/pro/RCKY. To access these tips and take advantage of the full suite of InvestingPro tools, use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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