Skechers Shares Plunge 9% on Q3 EPS Miss & Weak Guidance

Skechers U.S.A. (NYSE:SKX) saw its shares plummet over 10% intra-day today after reporting fourth-quarter earnings that fell short of analyst expectations and issuing a weaker-than-expected outlook for 2025. Despite record annual sales, investors reacted negatively to the company’s cautious guidance.

For Q4, Skechers posted adjusted earnings per share of $0.65, missing the consensus estimate of $0.74. Revenue reached $2.21 billion, slightly below analysts’ expectations of $2.22 billion, though it marked a solid 12.8% year-over-year increase.

Looking ahead, Skechers expects 2025 earnings per share between $4.30 and $4.50, falling well short of Wall Street’s $4.85 projection. Full-year revenue is forecasted at $9.7 billion to $9.8 billion, also missing the $9.87 billion consensus.

Despite the disappointing guidance, the company highlighted its strong 2024 performance, with full-year revenue hitting a record $8.97 billion, or $9.04 billion on a constant currency basis. Wholesale sales surged 17.5% in Q4 to $1.13 billion, while direct-to-consumer revenue climbed 8.4% to $1.08 billion. Gross margin saw a modest improvement to 53.3% from 53.1% a year earlier.

While Skechers continues to benefit from global consumer demand and effective marketing strategies, its tempered 2025 outlook suggests potential challenges ahead, weighing heavily on investor sentiment.

Skechers USA (NYSE:SKX) saw its shares soar 5% intra-day today after posting third-quarter earnings that surpassed Wall Street expectations and raising its full-year outlook. The footwear company’s impressive performance highlighted strong demand across global markets.

For the third quarter, Skechers reported adjusted earnings per share of $1.20, exceeding Wall Street estimates of $1.16. Revenue reached a record $2.35 billion, up 15.9% year-over-year and topping the Street forecast of $2.31 billion. This growth was fueled by a 20.6% increase in wholesale sales and a 9.6% rise in direct-to-consumer sales.

Looking ahead, Skechers raised its full-year 2024 revenue forecast to a range of $8.925 billion to $8.975 billion, exceeding its previous guidance and the Street consensus of $8.93 billion. The company also lifted its earnings per share projection to $4.20-$4.25, surpassing Wall Street’s expectation of $4.17.

UBS analysts reaffirmed their Buy rating on Skechers USA (NYSE:SKX), maintaining a price target of $88 on the stock. The analysts highlighted the potential for Skechers to exceed earnings expectations over the next twelve months, which could drive the stock higher. They believe Skechers is on track to reach $10 billion in revenue by 2026, solidifying its position as the world's third-largest footwear company. According to the analysts, the market currently undervalues the strength of the Skechers brand and its growth potential.

A recent meeting with Skechers management strengthened the analysts' confidence in their outlook. They project that Skechers will achieve an approximate 15% compound annual growth rate (CAGR) in EPS over the next five years. This level of growth could result in multiple positive earnings surprises in the near term, potentially pushing the stock toward the $88 price target.

Skechers USA (NYSE:SKX) saw its stock plummet by more than 6% intra-day today following the announcement of its first-quarter sales, which did not meet expectations.

The company reported earnings per share (EPS) of $0.56, marginally surpassing the forecasted $0.55. Nevertheless, Skechers' quarterly revenue of $1.96 billion was below the consensus estimate of $2.04 billion.

For the full year, Skechers USA set its EPS forecast in the range of $3.65 to $3.85, significantly under the consensus of $4.18. The company also anticipates its annual revenue to fall between $8.6 billion and $8.8 billion, which is less than the expected $8.94 billion.

Looking into the first quarter, Skechers expects sales to range from $2.175 billion to $2.225 billion, compared to the consensus of $2.19 billion. The projected EPS for the quarter is between $1.05 and $1.10, below the anticipated $1.20.

Additionally, Skechers USA detailed its capital expenditure forecast for the year, estimating total investments to be between $350 million and $400 million.

Skechers USA (NYSE:SKX) saw its stock plummet by more than 6% intra-day today following the announcement of its first-quarter sales, which did not meet expectations.

The company reported earnings per share (EPS) of $0.56, marginally surpassing the forecasted $0.55. Nevertheless, Skechers' quarterly revenue of $1.96 billion was below the consensus estimate of $2.04 billion.

For the full year, Skechers USA set its EPS forecast in the range of $3.65 to $3.85, significantly under the consensus of $4.18. The company also anticipates its annual revenue to fall between $8.6 billion and $8.8 billion, which is less than the expected $8.94 billion.

Looking into the first quarter, Skechers expects sales to range from $2.175 billion to $2.225 billion, compared to the consensus of $2.19 billion. The projected EPS for the quarter is between $1.05 and $1.10, below the anticipated $1.20.

Additionally, Skechers USA detailed its capital expenditure forecast for the year, estimating total investments to be between $350 million and $400 million.

Skechers USA (NYSE:SKX) received an upgrade from Piper Sandler analysts, who shifted the stock rating from Neutral to Overweight and raised the price target to $59 per share.

The analysts are more positive about Skechers' international business and believe it has the potential for medium-term earnings growth in the mid-teens.

Despite challenges in the U.S. wholesale market, strong direct-to-consumer trends indicate robust demand, which is expected to drive restocking. Additionally, Skechers is set to improve its gross margins, making it an appealing investment choice.