As a value investor, I'll be the first to tell you that on the surface shares of Skechers
But Kim Kardashian wears Shape-ups
We have witnessed numerous bubbles over the last decade on a macroeconomic level, but shoe industry fads have created some pretty spectacular bubbles as well. First was the collapse of Heelys
Even more spectacular was the collapse in the all-rubber shoe bubble that saw shares in Crocs
Toning shoes have helped early innovators like Skechers and Reebok take some market share from Nike
Reebok advertises research that its toning shoes will tone the gluteus muscles by up to 28% more than regular athletic shoes, while Skechers goes as far as saying that its shoes will help you "get in shape without setting foot in the gym."
It's not as if more independent research is needed to refute these claims, as my colleague Alyce Lomax recently pointed out there are plenty of these reports to go around. Just in case you needed some more evidence that this toning shoe craze is a fad, Skechers even has Kim Kardashian, the hottest fad in Hollywood, endorsing its shoes.
Another bad sign for Skechers investors is that the company has already begun selling its toning shoes in discount retailers like Ross Stores
The big question for investors is whether or not Skechers can continue to grow sales in its toning line. If not, is there another line of growth that will pick up the slack? Analysts at leading athletic shoe researcher SportsOneSource believe that more than half of Skechers retail sales this year have been toning shoes, so if this trend does die, the company has quite a hole to fill.
Skechers is most definitely a value if it can maintain its growth in the toning shoes segment, but to me the evidence suggests it's more of a value trap than a value stock.
Andrew Bond owns no shares in the companies listed. Costco is a Motley Fool Inside Value selection. Costco, Nike, and Timberland are Motley Fool Stock Advisor picks. The Fool owns shares of Costco and Timberland. You can follow Andrew on Twitter @Bond0 or on his RSS feed. Try any of our Foolish newsletters today, free for 30 days. The Fool has a disclosure policy.