Judging by the stock price, I couldn't have been more wrong about Crocs (NASDAQ:CROX). My call is right there for everyone to see in Motley Fool CAPS. I thought Crocs was doomed, and now I'm lugging around negative 196 points in CAPS because of that. 

Fortunately, rating a company an underperform in CAPS is far less painful than a short position in real life. But the stock's performance and my abysmal CAPS results have led me to two possible conclusions:

  • I'm dead wrong about the company's prospects;  
  • or, I massively underestimated how popular Crocs could become in the short term and the company's ability to sell them to so many retailers and restaurants.

As you might guess, I'm not convinced Crocs is for real. I still find that executives and other insiders selling nearly all of their shares is the ultimate sign that management doesn't believe this business has a long-term future. I think my biggest mistake was to underestimate the number of locations that the company could find for its products. Mall kiosks and TJX's (NYSE:TJX) Bob's Stores are logical places, but I didn't expect to see Crocs in restaurants such as Rainforest Cafe or Hallmark stores.

Ultimately, I still think competition will take its toll and that the shoes' popularity will fade. Some current competitive offerings include Payless ShoeSource (NYSE:PSS), L.L. Bean, and Skechers (NYSE:SKX), which recently rolled out its own line of rubber clogs and sandals. But it's almost summer, and that's the best season for sandals of all flavors. So for now, Crocs could very well continue to post impressive results, and I expect I'll be taking on a little more pain in CAPS.

For more related Foolishness:

Think you could pitch your favorite stock -- or ditch your least favorite -- in 27 seconds or less? We did that for Crocs at Motley Fool CAPS. Check out the rest of our stock videos.

Nathan Parmelee had no financial interest in any of the companies mentioned when this story was published. The Motley Fool has an ironclad disclosure policy.