Analysts Predict Revenue Declines for Sperry, Keds Parent Company in Q3

Wolverine World Wide Inc. is expected to produce soft third quarter results when the company reports its earnings before the market open Tuesday.

The parent company of several popular shoe brands — including Sperry, Keds, Saucony and Merrell — is projected to produce flat year-over-year earnings per diluted share, at 48 cents. Revenues are expected to slip 7 percent year-over-year, to $631.09 million.

Citi Research analyst Corinna Van der Ghinst — who predicted a revenue decline of 6.6 percent for the firm — said she believes revenue deceleration will be driven by mid-single-digit declines in Wolverine’s Lifestyle & Performance group as well as a mid-teens decline among its heritage brands.

In a Oct. 13 note, Van der Ghinst added that although she also expects gross margin contraction of 70 basis points, to 39.3 percent, due to FX headwinds, Wolverine Q3 guidance in July implied Q3 sales would be down mid-single digits to high-single digits with stronger performance in Q4.

CL King & Associates analyst Steve Marotta downward adjusted his estimates for Wolverine’s Q3, citing a confluence of factors.

“We are lowering our Q3 sales and EPS estimates in light of overly optimistic initial assumptions, combined with weaker than anticipated industry results during the time period,” Marotta wrote on Oct. 13. “Q3 sales are being reduced to down 7.6 percent, from down 3.6 percent, or $627 million, from $654 million.”

Marotta also reduced his EPS estimate, to 45 cents, from 47 cents. These compare with the year-ago results of $679 million and $0.48, respectively.

Wolverine’s stock ended Monday down 2.3 percent, to $22.04. 

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