Investing in the stock market is the best path to building long-term wealth, but in 2021, many market participants have taken to speculating on unproven assets. Cryptocurrency Dogecoin (DOGE -1.82%) immediately comes to mind here. Although its price has risen astronomically this year, it's too risky for someone who wants to grow their wealth in a prudent manner. 

If it's fast growth you're looking for, I have a company that might interest you: Crocs (CROX -1.97%). Many investors may be surprised to learn the maker of foam clogs has experienced impressive gains over the past year. Let's see if this footwear stock deserves a place in your portfolio. 

A person looking at a stock chart on their phone

Image source: Getty Images.

A big pandemic winner 

Over the past four quarters, Crocs's revenue growth has been accelerating at an impressive rate. In the second quarter, sales jumped 93% year over year to $641 million. And profitability over the last 12 months has been nothing short of spectacular. During that time, Crocs sported a gross margin and a net income margin of 57.9% and 35.4%, respectively.

While the financial media gives plenty of attention to the more obvious pandemic winners -- video conferencing, streaming entertainment, and e-commerce stocks -- it appears this $8.9 billion footwear brand was also a beneficiary of people spending more time than ever at home. In addition to being a staple for healthcare employees and other workers who spend a lot of time on their feet, Crocs turned into a popular product for people working remotely as comfort became a priority. 

In the most recent quarter, direct-to-consumer sales accounted for 52% of total revenue. This is important for Crocs as it helps support the company's pricing strategy and maintains its brand image. The average selling price for Crocs's products rose 8% year over year to $21.84. Having prices this low while boasting a higher gross margin than companies like Nike and Adidas is remarkable.

And the stock has performed like a pandemic winner, rising over 260% in the past year and over 1,200% from its March 2020 lows. Now consider that performance for a popular footwear brand with a sustainable business model, and compare it to Dogecoin, which was originally created as a joke. The cryptocurrency has received a lot of attention from speculators, but investors must remember it has almost no real utility. With the volatility and uncertainty Dogecoin holders must face, investors should stick to shares of burgeoning companies like Crocs.

Looking ahead 

The big question, then, is whether or not Crocs's strong growth can continue in the years ahead. Like many apparel businesses, its products have gone in and out of favor with consumers over the years -- that's just the nature of the industry. There are, however, some things the company is doing to maintain its position.

Crocs has been attracting younger customers through collaborations with stars like Justin Bieber, Bad Bunny, and Post Malone. This has proven to be an effective strategy, and management expects it to continue in the future. In Asia, which is seen as the largest long-term growth opportunity, Crocs plans to replicate what has worked so well in the U.S., leaning heavily on top-tier celebrities and influencers to tap into the second-biggest footwear market, China. 

CEO Andrew Rees certainly believes his business's success is here to stay. "We continue to see strong consumer demand for the Crocs brand globally," he said in the second-quarter earnings call. For full-year 2021, management now expects revenue growth of 60% to 65%. That would easily put Crocs over $2.2 billion in annual sales, almost doubling what the company reported as recently as 2019.

Based on analysts' consensus earnings per share (EPS) estimate of $6.72 for the current year, the stock trades at a very reasonable price-to-earnings multiple of 21, cheaper than the S&P 500. This makes the opportunity for investors even more attractive, given the company's ongoing success and strong momentum. 

For those looking to speculate in the cryptocurrency market, I urge you to seriously consider this growth stock instead.