What Happened?
Shares of footwear company Skechers (NYSE:SKX) jumped 10.4% in the afternoon session after the company reported a "beat and raise" quarter. Skechers exceeded analysts' constant currency revenue expectations and EPS outperformed Wall Street's estimates. The top line was driven by the strengths of the Wholesale segment (which indicates strong demand from its distributors and partners) and in international markets. The company also raised its full year revenue and EPS guidance, both of which came in above expectations. Overall, this was a solid quarter with many positives.
Deckers, a footwear peer, also reported strong results, suggesting consumer demand for athletic and casual footwear is holding up despite some mixed signals in spend in other categories. After the initial pop the shares cooled down to $60.28, down 2.2% from previous close.
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What The Market Is Telling Us
Skechers’s shares are not very volatile and have only had 6 moves greater than 5% over the last year. Moves this big are rare for Skechers and indicate this news significantly impacted the market’s perception of the business.
The biggest move we wrote about over the last year was 6 months ago when the stock gained 17.4% on the news that the company reported a rare 'beat and raise' quarter. Skechers blew past analysts' constant currency revenue expectations. Its operating margin also outperformed Wall Street's estimates.
Looking forward to the full year, the company raised its revenue and EPS guidance for 2024, and both were comfortably ahead of analysts' expectations. Overall, this quarter's results seemed fairly positive, and shareholders should feel optimistic.
Skechers is down 2.9% since the beginning of the year, and at $60.28 per share, it is trading 19.1% below its 52-week high of $74.50 from June 2024. Investors who bought $1,000 worth of Skechers’s shares 5 years ago would now be looking at an investment worth $1,591.
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