Skechers USA Inc (NYSE:SKX)
Skechers, the second-largest athletic footwear manufacturer in the United States reported their third-quarter earnings on Thursday October 19th 2017 after the market closed. Not only did they beat on the bottom line but they beat on the top line and they beat handily.
Shares reacted swiftly and traded on heavy volume in the after hour session. Shares which had traded down -$1.06 and closed at $24.03 in the regular session rocketed higher by +$5.57 or 23% and closed at $29.60 as of 8 p.m.
Eastern Daylight Time. Shares have traded in a 52-week range from a low of $18.81 to a high of $30. So it will be very interesting to see how the shares react at the $30 level when Cher’s open up in the morning for trading. Many eyes of Traders and investors will be watching this one closely.
The Numbers
Skechers reported earning $92.3 million dollars or $0.59 per share and this compares with earning $0.42 per share or $65 million in the prior quarter. Revenues rose to a record $1.1 billion dollars.
Much of this has been attributed to the company’s recent success in sales in their international wholesale business segments.
Analysts had been expecting only $0.43 per share for the quarter. It is these kind of earnings beats that can propel stocks into a new uptrend for many months to come.
Company Comments
David Weinberg, chief operating officer and chief financial officer had this to say to investors;
“Third quarter net sales of $1.095 billion set a new quarterly record for the Company, surpassing our previous record in the first quarter earlier this year by $22 million, and resulted in a new nine month record with sales exceeding $3 billion. The growth came across our three distribution channels—with double-digit increases in our Company-owned Skechers retail business worldwide and our international subsidiary and joint venture businesses, as well as a single-digit increase in our international distributor and domestic wholesale businesses. The strong international growth, including the continued strength in China, the resurgence of the United Kingdom and growth across all of Europe combined with our strong international retail business, resulted in international wholesale and retail representing 53 percent of our total sales in the third quarter.”
SKX Charts
The above price chart shows the daily action going back 5 months. It is clear to see how the share price has respected the green support trend line. End with the outstanding earnings it is also clear to see how the share price will be breaking out well above the red horizontal resistance line.
The above price chart shows the intraday action on Thursday on the left and the aftermarket session on Thursday on the right. Clearly there was an explosion in the stock price as soon as the phenomenal earnings were announced.
Skechers Profile
Skechers U.S.A., Inc. designs, develops, markets, and distributes footwear for men, women, and children; and performance footwear for men and women under the Skechers GO brand worldwide. It operates through three segments: Domestic Wholesale Sales, International Wholesale Sales, and Retail Sales.
The company offers casual boots, shoes, and sandals for men; oxfords and slip-ons, lug outsole and fashion boots, and casual sandals for women; dress casuals, seasonal sandals and boots, classic and wide fit, and relaxed fit casuals for men and women; and casual fusion line for young men and women under the Skechers USA brand.
It also provides lightweight sport athletic lifestyle products, classic athletic-inspired styles, and sport sandals and boots under the Skechers Sport brand name; casual and sporty styles sneakers under the Skechers Active and Skechers Sport Active brand; and sports line under Skechers Originals brand.
In addition, the company offers classic espadrille, and vulcanized and sport footwear under the BOBS from Skechers name; casual, dress, and active styles, as well as casual sneakers for men under the Mark Nason name; technical footwear under the Skechers Performance brand; and boots, shoes, high-tops, sneakers, and sandals for infants, toddlers, boys, and girls under the Skechers Kids name.
Further, it provides men’s and women’s casuals, such as field boots, hikers, and athletic shoes under the Skechers Work brand. The company sells its products through department and specialty stores, athletic and independent retailers, boutiques, and Internet retailers, as well as through its e-commerce Websites and own retail stores.
As of February 1, 2017, it owned and operated 117 concept stores, 163 factory outlet stores, and 134 warehouse outlet stores in the United States; and 101 concept stores, 51 factory outlet stores, and 5 warehouse outlet stores internationally. Skechers U.S.A., Inc. was founded in 1992 and is headquartered in Manhattan Beach California.