Crocs, Inc. - Momentum

Crocs, Inc. (CROX) just hit a new multi-year high after surging on excellent Q3 results that included a 4% earnings surprise. With an average earnings surprise of 177% over the last four quarters and a bullish growth projection, this Zacks #1 rank stock is a shoe-in for momentum.

Company Description

Crocs, Inc. and its subsidiaries design, manufacture and sell footwear for men, women and children worldwide. The company was founded in 1999 and has a market cap of $1.34 billion.

Shares of CROX have been ripping higher for most of the last two years, recently hitting a new multi-year high at $15.79 after reporting solid Q3 results on Nov 3 that came in ahead of expectations.

Third-Quarter Results

Revenue for the period was up 30% from last year to $216 million. Earnings also looked good, coming in at 25 cents, 4% ahead of the Zacks Consensus Estimate, where the company now has an average earnings surprise of 177% over the last four quarters.

The company saw solid gains across its multiple revenue channels, with retail sales leading the way with a 35% gain from last year to $72.5 million. Its largest segment, wholsale, was up 16% to $123.9 million.

Geaographically speaking, not only are the America's Croc's largest region, it also saw the biggest gain, with sales up 31% to $104 million. Sales in Asia were up 16% to $79 million.

Awesome Balance Sheet

Croc's also emerged from the quarter with an even stronger balance sheet, with cash and equivilants up 88% from last year to $143 million with no debt.

Estimates

The analysts are still adjusting their models off the good quarter, but estimates are still up in the interim none the less, with the current year adding a penny to 71 cents. The next-year estimate is pegged at 88 cents, a bullish 25% growth projection.

Valuation

When factoring in the bullish growth projection, shares look reasonably priced, trading with a PEG (PE/Growth) of .83%, well below the value bench mark of 1.0.

2-Year Chart

On the chart, shares recently jumped higher to hit a new multi-year high at $15.79. The MACD below the chart is bullish too, with the short-term average trending ahead of the long-term average. Look for support from the trend line on any weakness, take a look below.

Michael Vodicka is the Momentum Stock Strategist for Zacks.com. He is also the Editor in charge of the new Zacks Momentum Trader Service.
 
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