There's a lot going on with Crocs (CROX -0.45%) these days. The maker of cozy, distinctive, and -- yes -- polarizing footwear posted mixed financial results earlier this month. It was a problematic "beat and lower" scenario where Crocs blasted through quarterly expectations, while also hosing down its full-year outlook.

That rare occurrence has been somewhat common this earnings season. There's a fair amount of foggy uncertainty when it comes to companies at the mercy of consumer spending in this tricky climate. However, with Crocs trading at an earnings multiple in the single digits and growing even its organic sales at a double-digit pace, it's an intriguing situation with a lot of upside. Let's walk a mile in a Crocs investor's shoes. 

Six people showing off their Crocs shoes.

Image source: Crocs.

Crocs pot 

It's been 20 years since Crocs were introduced as boating shoes for their ability to withstand wet and slippery conditions. The comfortable resin material was quickly embraced by workers in professions who spend a lot of time on their feet, like teachers and nurses. A few years ago, celebrities and influencers started taking to the colorful shoes, throwing fashionistas for a loop. 

Today, Crocs is a fast-pacing player among shoe stocks. The stock is an eight-bagger over the past five years. Despite a pair of lulls through its first two decades, it has come through with positive top-line growth in 75% of those years. In an industry where even the best brands routinely post sleepy growth, 80% of Crocs' years of revenue growth produced double-digit- percentage gains. If Crocs are a fad, it's a trend that continues to bounce back stronger at every turn.

There are two defining moments that have weighed on Crocs this year. The first is the $2.5 billion acquisition of HeyDude that was announced late last year but closed in February. Despite telling investors that buying the faster-growing HeyDude would be accretive to earnings, the market feared that expanding its product line was a sign that its flagship shoes were waning in popularity. 

Those fears have been largely unfounded. It's true that most of the 47% to 52% in revenue growth that Crocs is now forecasting is the handiwork of HeyDude sales that didn't exist for Crocs last year. But the namesake brand, which will still account for 73% to 77% of the total top-line mix, is still expected to grow its sales by 10% to 13% in 2022 -- or 14% to 17% on a constant currency basis. In short, it's another year of double-digit growth for the Crocs brand.

This month's quarterly report was also a letdown. Crocs handily beat expectations, but it slightly lowered its revenue and earnings targets for all of 2022. It now expects a profit of $9.50 to $10.30 per share, or $9.90 at the midpoint. Crocs stock began this week fetching just 7.4 times that earnings midpoint. No matter how you slice it, that's pretty cheap unless you think comfortable shoes are becoming obsolete.

Things aren't perfect. The HeyDude deal was largely financed, and that's not a good look with rates moving higher. A stronger dollar is also weighing on its resilient international sales. But Crocs is still a growth stock trading at a value stock multiple. Sooner or later, the market will realize that sometimes you need something comfortable beneath your feet.