Skechers USA Goes Negative

Skechers USA (NYSE: SKX  ) reported earnings on Feb. 15. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Skechers USA whiffed on revenues and missed expectations on earnings per share.

Compared with the prior-year quarter, revenue shrank significantly and GAAP earnings per share shrank to a loss.

Margins dropped across the board.

Revenue details
Skechers USA reported revenue of $283.2 million. The five analysts polled by S&P Capital IQ wanted to see revenue of $321.9 million on the same basis. GAAP reported sales were 37% lower than the prior-year quarter's $456.0 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
Non-GAAP EPS came in at -$0.58. The five earnings estimates compiled by S&P Capital IQ predicted -$0.22 per share on the same basis. GAAP EPS were -$1.18 for Q4 versus $0.07 per share for the prior-year quarter.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 40.4%, 30 basis points worse than the prior-year quarter. Operating margin was -20.4%, 2,070 basis points worse than the prior-year quarter. Net margin was -20.1%, 2,080 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $359.8 million. On the bottom line, the average EPS estimate is -$0.01.

Next year's average estimate for revenue is $1.50 billion. The average EPS estimate is $0.16.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 539 members out of 568 rating the stock outperform, and 31 members rating it underperform. Among 176 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 169 give Skechers USA a green thumbs-up, and seven give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Skechers USA is hold, with an average price target of $14.48.

Over the decades, small-cap stocks like Skechers USA have provided market-beating returns, provided they're value-priced and have solid businesses. Read about a pair of companies with a lock on their markets in "Too Small to Fail: Two Small Caps the Government Won't Let Go Broke." Get instant access to this free report.

Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings. He is the co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Motley Fool newsletter services have recommended buying shares of Skechers USA. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

DocumentId: 1791579, ~/Articles/ArticleHandler.aspx, 4/18/2014 10:56:58 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement